Construction sector beats forecast with strong January performance
The UK’s construction sector picked up pace in January, despite economists predicting a poor performance for the month, lse.co.uk reports.
According to research carried out by Markit Economics and the Chartered Institute of Purchasing and Supply (CIPS), the industry’s activity increased at its fastest rate since August 2007. This also marks the ninth consecutive month of growth.
The firms’ Purchasing Managers’ Index, a measurement of the sector’s performance, reached 64.6 last month, rising from December’s reading of 62.1. The growth comes after economists suggested it would drop to 61.5.
House building expanded at it’s fastest in almost 11 years
The report shows that engineering and commercial construction both performed well, with residential building also showing strength. According to reuters.com, Markit claimed that house-building expanded at its fastest rate in almost 11 years.
Markit’s senior economist, Tim Moore, was quoted by reuters.com as saying: “January’s survey provides reassurance that the UK construction recovery remains on track.” There are suggestions, however, that the success could lead to supply issues as companies find it difficult to keep up. Mr Moore went on to say:
“While input cost inflation eased in January, there were again signs that some suppliers are struggling to adjust to greater demand for construction materials.”
Researchers also found that optimism in the industry is the highest it’s been for more than four years.
Author: Graeme Parton Date Written: 04 February 2014