U.K. Housing Lifts Construction Growth to Strongest Since 2015By
Index rises to 56 in May, a far better reading than forecast
Manufacturing survey earlier this week showed solid activity
Britain’s construction industry unexpectedly picked up last month, growing at the fastest pace since 2015 as housing strengthened.
IHS Markit’s monthly index rose to 56 in May from 53.1 in April, a far better reading than the decline to 52.6 forecast by economists. Workloads increased the most this year and the pace of hiring also improved, according to the report published Friday.
The report follows a stronger-than-forecast manufacturing survey from Markit this week, which showed solid factory activity. A gauge of services, the largest part of the economy, will be published on Monday.
In the construction report, there were also signs that cost pressures -- largely related to the weaker pound -- are easing, with input prices rising at the slowest pace in seven months. Some companies said that the peak phase of price hikes for imports had now passed.
The one cloud in the report was Brexit and the outlook for the economy, with firms noting that “heightened economic uncertainty continued to act as a brake on client spending.”
— With assistance by Jill Ward, Mark Evans, and Harumi Ichikura