UK construction reports unexpected monthly advance

UK construction reports unexpected monthly advance
04 April 2012

UK construction expanded at the fastest pace in 21 months in March, adding to signs the economy returned to growth in the first quarter.

A gauge of building activity rose to 56.7 from 54.3 in February, Markit Economics Ltd. and the Chartered Institute of Purchasing and Supply said in a report today in London. The median forecast in a Bloomberg News survey of nine economists was 53.4. A reading above 50 indicates expansion. Markit said confidence at companies increased to a 22-month high.

The construction report follows a survey yesterday showing manufacturing grew at the fastest pace in 10 months in March. The British Chambers of Commerce said today Britain has probably avoided a second recession, though the government needs to do more to stoke a “weak” recovery.

“The good weather appears to have led to a surge in demand for construction projects in March, adding to the recent flow of good news which suggests the economy will have skirted a recession,” said Chris Williamson, chief economist at Markit. “The particularly encouraging news is that the improvement in confidence is generating more jobs.”

The report showed that all three construction categories – housing, commercial and civil engineering – registered growth in March. Employment increased, which Markit said reflected growth in new orders and output at companies.

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Tagged Under: UK Construction