U.K. construction PMI beats expectations, new order growth hits 11-month high

U.K. construction PMI in December beat expectations. Report released by market research firm Markit and the Chartered Institute of Purchasing & Supply (CIPS) showed U.K. construction PMI in December rose to a seasonally adjusted 54.2 from November’s reading of 52.8. Data beat economists' expectations for the index to remain steady at 52.8 in December.

All three main areas of construction activity have started to recover from last summer’s soft patch. New order growth hit an 11-month high, supported by rising client demand and a resilient economic backdrop.

The latest rise in employment was the fastest since May, but still much weaker than seen on average since the jobs rebound began in mid-2013. Construction companies reported a reasonably upbeat assessment for their growth prospects in 2017.

However, the construction sector continued to experience intense cost pressures as suppliers passed on higher imported raw material prices. The latest rise in overall input costs was the steepest for just over five-and-a-half years.

“In the short-term at least, the sector looks set to enjoy these improved demand conditions for the coming months, which is positive news after many months of instability,” said David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply