UK Construction PMI Grows at Fastest Rate in 14 Months

• UK Construction PMI Grows at Fastest Rate in 14 Months

British construction industry unexpectedly expanded at the fastest pace in over a year in July.

The construction Purchasing Managers’ Index jumped from June’s 53.1 to 55.8, beating analysts’ estimates of 52.8 despite the uncertainty surrounding global growth and Brexit. The data released ahead of rates decision showed the sector rose to its highest since may 2017.

According to the data released by the IHS Markit, the sector was boosted by the biggest surge in house building since the end of 2015.

“July data reveal an impressive turnaround,” IHS Markit economist Tim Moore said.

The numbers, however, contrast with the weak data recorded during the first quarter of the year when icy weather hurt the sector, causing output to dip by 0.8 percent.

“While the recent rebound in construction work has been flattered by its recovery from a low base earlier in 2018, there are also signs that underlying demand conditions have picked up this summer,” IHS Markit’s Moore said.

Overall, the construction sector was positive as new orders rose at the fastest pace since May 2017 and both house building and job creation climbed by the most in almost three years.

The pound is still weighed upon by the uncertainty surrounding Brexit and global trade tensions. The currency dipped slightly against the U.S dollar to $1.3120.