According to the report from IHS Markit, The Eurozone ConstructionN Total Activity Index rose from 50.0 in September to 51.2 in October, indicating a modest expansion in construction activity. The increase was the first recorded since June and the sharpest since the onset of the COVID-19 pandemic. Growth was commonly linked to stronger demand and increasing workloads. House building remained the strongest monitored sub-sector in the eurozone, though there was also a renewed rise in commercial construction in the latest survey period. Civil engineering work remained in contraction territory, however.
Work undertaken on housing by eurozone construction firms increased modestly in October. The expansion was the eighth in consecutive months, but the pace of growth eased to the softest since March. A sustained and robust rise in Italian homebuilding activity was partially offset by a renewed contraction in French homebuilding. German firms meanwhile signalled a third consecutive contraction at the start of the fourth quarter.
Eurozone commercial activity returned to expansion territory in the latest survey period. The increase was the first since February 2020, with the rate of growth modest overall. Both French and German firms indicated a renewed rise in commercial building, with the upturn among the former at a five-month high. This was complemented by a moderate rise in Italy, though growth eased to the softest since February.
The downturn in civil engineering activity across the eurozone continued in October, taking the current sequence of decline to 27 months. The rate of contraction was broadly unchanged from September and was solid overall. While firms in France registered a softer reduction in infrastructure activity, German firms pointed to the quickest contraction in eight months. Italian firms meanwhile signalled a third straight expansion.