UK construction PMI bounces back in December

The UK construction sector rebounded in December from a seven-month low, led by commercial building activity.

The Markit/CIPS construction purchasing managers’ index rose to 57.8 from 55.3 in November, beating expectations for a reading of 56.

Commercial construction remained the best performing sub-category of activity, with the latest upturn the fastest since October 2014.

Tim Moore, senior economist at Markit, said: “UK construction companies finished 2015 in a positive fashion, as overall output growth recovered from November’s seven-month low.

"Across the UK construction sector as a whole, the latest survey indicated a strong degree of optimism about the outlook for 2016, with firms mainly citing a strong pipeline of commercial development projects and new housing starts. There were also reports that sustained improvements in UK economic conditions had led to upbeat expectations for clients’ budget setting for the year ahead."

Howard Archer, chief European and UK economist at IHS Global Insight, said: "This is a largely decent, reassuring survey that boosts hopes that construction output contributed to GDP growth in the fourth quarter of 2015 after being a drag in the third quarter."