Construction activity remains 'solid', but Brexit and input prices drag

UK construction output in October was lifted to its highest level since March by continued solid housing activity, but the rate of growth slowed from the previous month.

The seasonally adjusted Markit/CIPS UK construction purchasing managers’ index (PMI) edged up to 52.6 in October from 52.3 the months before.

"The latest reading pointed to the fastest upturn in activity since March, although the rate of growth was only modest and still much softer than the average since the recovery began three-and-a-half years ago," Markit said.

Civil engineering activity decreased slightly but commercial construction stabilised and residential building work delivered another 'solid' increase that was down only slightly from September’s eight-month high.

New order growth was the weakest for three-and-a-half years, though construction companies reported further upturns in staffing levels and purchasing activity, even though some firms noted that Brexit-related uncertainty was holding back client confidence and delaying spending decisions.

Input prices increased at the second-fastest rate since July 2011, with "anecdotal evidence" suggesting suppliers were seeking to pass on higher imported raw material prices following collapse of the pound.