Ekonomické zprávy

Activity in the UK construction sector increased slightly in April

According to the report from S&P Global / CIPS, the growth of business activity in the construction sector accelerated slightly in April, exceeding economists' forecasts. As for the inflationary situation, input price pressures eased, with the rate of cost inflation the lowest for almost 2.5 years.

UK construction PMI rose to 51.1 points from 50.7 points in March. The index remains above 50 points, which indicates an expansion of activity in the sector, for the third month in a row. Economists had expected an increase to 51.0 points.

Commercial building was the fastest-growing area of the construction sector (index at 53.9), with the rate of expansion being the second-strongest since October 2022. Civil engineering activity (index at 52.0) also picked up, supported by resilient pipelines of work on infrastructure projects. Meanwhile, housing construction was the weakest segment in April (index 43.0). The rate of decline for total residential work was the steepest for nearly three years. The data also showed that the number of new orders received by construction companies increased for the third month in a row, while the pace of expansion accelerated slightly from March and remained higher than the average in the second half of 2022. The higher level of new orders was associated with steady customer demand, especially in commercial construction. The growth of construction activity and the upcoming launch of projects contributed to a moderate increase in employment in April. Resource purchases have also expanded, albeit at a modest pace. Meanwhile, supply chain improvements continued in April. The combination of improved supply and relatively low demand has helped to reduce price pressures in the construction sector. As for the prospects, construction companies expect further growth in business activity in the coming year, but the degree of confidence has fallen to a three-month low.

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