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- UK construction PMI unexpectedly falls in August
UK construction PMI unexpectedly falls in August
The report from
IHS Markit and Chartered Institute of Procurement & Supply (CIPS) showed
that activity in the construction sector of the UK’s economy in August declined
for the fourth consecutive month and at a slightly steeper rate than in July.
According to
the report, the Markit/CIPS Purchasing Managers' Index (PMI) for the UK’s
construction sector fell to 45.0 in August from an unrevised 45.3 in July.
Economists had
forecast the indicator to increase to 45.9. The 50 mark divides contraction and
expansion.
According to
the report, the new work recorded the sharpest reduction since March 2009.
However, despite a sustained reduction in new orders, employment trends were
relatively resilient during August. The latest survey pointed to only a
marginal decline in staffing levels, with the rate of decline the slowest since
the downturn in payroll numbers began in April. Meanwhile, business optimism
slid for the second month running in August, with the degree of positive
sentiment the weakest since December 2008. On the price front, input cost inflation
moderated to its lowest since March 2016.
Tim Moore,
Economics Associate Director at IHS Markit, which compiles the survey, noted: “Domestic
political uncertainty continued to hold back the UK construction sector in
August, with survey respondents indicating that delays to spending decisions
had contributed to the sharpest fall new work for over 10 years.”
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