Financial News: UK Construction Sector Maintains Robust Growth

UK Construction Sector Maintains Robust Growth

09/05/2024 - 05:48:00 (RTTNews)

(RTTNews) - The UK construction sector posted another strong growth in August as lower borrowing cost and gradual improvement in market conditions boosted residential work, survey results from S&P Global showed on Thursday.

The construction Purchasing Managers' Index fell to 53.6 in August from July's 26-month high of 55.3. The reading was expected to drop moderately to 54.6.

However, the score has remained above the 50.0 no-change mark for the sixth consecutive month.

Among three segments, commercial activity was the best-performer despite growth easing to the lowest since March. The improving economic backdrop lifted order books but the post-election bounce in demand faded somewhat in August.

Meanwhile, civil engineering activity expanded at a moderate pace that was weaker than in July.

Residential work was the only sub-sector to gain momentum with growth rising to its fastest since September 2022. Lower borrowing costs and a gradual recovery in market conditions helped to boost residential work.

There was another robust growth in total new work in August as improving economic conditions and greater domestic political stability lifted customer demand.

Strengthening order books as well as an upturn in sales pipelines underpinned positive sentiment regarding the year-ahead business outlook.

Staffing levels were broadly unchanged, which ended a three-month period of expansion. Moreover, sub-contractor usage decreased for the first time since January.

Purchasing price inflation remained muted with cost pressures easing since July. Input buying expanded for the fourth straight month. Meanwhile, suppliers' delivery times shortened on average but a number of survey respondents commented on constrained haulage capacity.

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