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UK Construction PMI Rises to 53.1 in June

Published 07/03/2018, 04:31 AM
© Reuters.  UK construction PMI rose 53.1 vs. 52.5 forecast

Investing.com - Activity in the UK construction sector accelerated last month, hitting a seventh month high, according to a closely watched business survey released on Tuesday.

Research firm IHS Markit said its construction purchasing managers’ index rose to 53.1 in June.

Analysts had expected the reading to hold steady at 52.5.

On the index, a reading above 50.0 indicates expansion, below indicates contraction.

IHS Markit highlighted that house building remained the best performing area of activity while new orders rose at the fastest pace since May 2017.

The research firm also noted that input cost inflation accelerated in June.

“A solid contribution from house building helped to drive up overall construction activity in June, while a lack of new work to replace completed civil engineering projects continued to hold back growth,” IHS Markit associate director Tim Moore commented in the report.

Moore also added that survey respondents suggested that improved opportunities for industrial and distribution work were the main bright spots, which helped to offset some slowdown in retail and office development.

Stretched supply chains and stronger input buying resulted in longer delivery times for construction materials during June.

“At the same time, higher transportation costs and rising prices for steel related inputs led to the fastest increase in cost burdens across the construction sector since September 2017,” Moore concluded.

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