UK Construction Output Dips in July as House-Building Falls

British construction output unexpectedly dipped in July on the month, reversing a bounce seen in June, after the biggest annual fall in house-building in more than two years, official data showed on Friday.

Construction output fell by 1.0 percent on the month, bucking economists’ forecasts of a 0.5 percent pick-up after an unrevised 0.9 percent rise in June.

Compared with a year earlier, output fell by 0.7 percent, again disappointing economists’ forecasts of a 0.6 percent rise.

A major driver of the decline was a year-on-year fall in the amount of new housing being built, which dropped by 2.5 percent, the first decline since March 2013.

Construction of public housing fell by a hefty 15.6 percent, while the 0.8 percent growth in private construction was the slowest since March 2013 as well.

Construction fell sharply after the financial crisis and was slow to recover, but gained pace last year before easing in early 2015.

Only on Thursday, the Royal Institution of Chartered Surveyors pointed to a lack of housing as driving the biggest price rises in over a year. It estimates overall property prices will rise 6 percent in Britain this year.

Construction makes up 6 percent of Britain’s economy, but the data is volatile, especially on a monthly basis, and can contribute to significant revisions to overall GDP.

Reuters

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