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The UK construction sector enjoyed further growth in February, data from IHS Markit showed Friday, achieving its fastest rise in output for eight months.
The headline seasonally adjusted IHS Markit-CIPS UK construction purchasing managers' index total activity improved to 59.1 in February from 56.3 in January. Any reading above 50.0 indicates growth.
Market consensus, according to FXStreet, had predicted the construction PMI to remain at 56.3.
‘Building companies commented on the strongest rise in output since mid-2021 amid stronger client confidence and work on new projects commencing,’ IHS Markit said.
‘Construction companies continued to report widespread supply constraints and rapidly increasing input costs, though the rate of inflation in the latter was the least severe for 11 months. That said, ongoing disruption dampened the year-ahead outlook for activity, with confidence at the lowest since January 2021.’
IHS Markit noted the headline construction index has now recorded a figure above the neutral 50.0 threshold in each of the last 13 months.
Usamah Bhatti, economist at IHS Markit, said: ‘UK construction companies achieved a faster expansion in output volumes in February as the economy recovered from the recent wave of Covid-19 infections related to the Omicron variant. House building had the strongest showing, as signalled by the fastest rise in residential work for eight months.
‘Despite continued volatility in price and supply conditions, the overall rate of new order growth accelerated from January to reach the fastest since last August as client confidence improved in line with economic activity as Plan B restrictions were fully lifted.’
Bhatti, however, did point to rising input costs which have placed further strain on businesses.
‘It appears that the peak of price pressures has passed as the rate of input cost inflation eased for the sixth month in a row to reach the softest since last March. At the same time, reports of supplier delays were considerably lower than those seen in the middle of last year. Yet, price and supply constraints weighed on overall business confidence, which eased to the softest in just over a year,’ he added.
The IHS Markit-CIPS UK construction PMI is compiled by IHS Markit from responses to questionnaires sent to a panel of around 150 construction companies - with the data collected between February 10 to 25.
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