UK Construction Sector Slows Down To Five Month Low

Growth in the UK construction sector fell to a five-month low in October as home building slowed sharply, a closely-watched survey has suggested.

The Markit/CIPS UK construction Purchasing Managers’ Index fell to 61.4 in October from 64.2 the month before. A figure above 50 indicates growth.

The fall was steeper than economists had forecast, but was affected by house building which saw its slowest rate of growth for a year.

Civil and commercial work also slowed.

“October’s survey provides the first indication that the chill winds blowing across the UK housing market have started to weigh on the booming residential building sector,” said Tim Moore, senior economist at Markit.

Markit said that some respondents blamed less favourable market conditions for “greater caution” among clients, causing delays to the launch of new development projects.

It said tighter mortgage lending conditions and “renewed uncertainties” about demand had helped to drive the slowdown.

Since April, lenders have had to make more detailed checks before approving mortgages.

Despite the slowdown, the construction sector has now expanded for 18 months in a row, marking its longest continuous period of growth since the start of the financial crisis in 2007.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza