UK construction PMI drops to 52.8 in December, a slight miss on expectations

The construction sector activity in the UK economy grew at a slightly slower pace than expected in December, a fresh report from Markit Economics showed on Thursday.

The final Purchasing Managers' Index (PMI) came in at 52.8 in December, up from 53.4 seen in November while missing markets expectations (52.9 expected).

Key Points:

Business activity expands at weakest pace for three months

Softest rise in commercial work since May 2018.

Rebound in business optimism amid hopes of infrastructure boost in 2019.

Tim Moore, Economics Associate Director at IHS Markit, which compiles the survey:

“UK construction firms signaled a slowdown in housing and commercial activity growth during December, which more than offset a strong performance for civil engineering at the end of 2018.”

“Subdued domestic economic conditions and an intense headwind from political uncertainty resulted in the weakest upturn in commercial work for seven months.”

“Strong demand among first-time buyers meant that house building was the fastest growing category of construction output during 2018. However, construction companies indicated a renewed loss of momentum in December. Residential growth remains much softer than the two-and-a-half year peak achieved last summer.”