UK Housebuilding Falls in August

October 10, 2014 Share Print 0

A sharp fall in new housebuilding in August reversed a long period of expansion in the construction industry, according to official figures.

Output fell for the first time in 18 months as infrastructure spending and building maintenance, which have both remained weak all year, also contracted.

The figures will disappoint the Treasury, which has championed housebuilding as a way out of the current housing crisis. The fall in infrastructure construction will also prove a blow to George Osborne, who has repeatedly said new transport and digital infrastructure is necessary for sustainable growth.

Output fell 3.9% compared with July, said the Office for National Statistics (ONS), dragged down by a 4.8% decline in all types of new work. Only a small rise in public housing offset falls in infrastructure of 6.5%, a 4.9% decline in private industrial and private housing’s 5.5% contraction.

Alan Clarke, head of European fixed-income strategy at Scotiabank, said: “UK construction output got pummelled into the ground in August.” He said the figures would dent third-quarter GDP calculations, though probably by only 0.1%.

via The Guardian

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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.