German construction hits eight-month high in November

Growth in the German construction sector advanced strongly in November, a widely-followed survey showed on Friday.

The headline index of Markit’s construction purchasing managers’ index rose from 51.8 to an eight-month high of 52.2 last month, marking the tenth consecutive month of expansion in building activity.

The report indicated the growth in construction output was broad-based, with growth reported across all the three categories monitored by the survey for the first time since March.

The sharpest rise in output was recorded in the residential building sub-sector, while housing activity increased for the 14th consecutive month and at the strongest rate since March.

Faster growth was also reported for commercial building activity, with the respective index also reaching an eight-month high.

New business placed with German construction companies declined for a sixth month in a row amid reports of unfavourable weather and fewer tenders in the market, although the decline was minimal, Markit added.

“The data also signalled ongoing strains on operating capacity, as the amount of work contracted out rose for a third month running and sub-contractor pay rates increased further,” said Markit economist Oliver Kolodseike.