S&P Global's all-sector PMI - which includes services and manufacturing data released last week as well as Monday's construction number - slipped to 48.5 in January from 49.0 in December, its second-lowest reading in two years. (Reporting by William Schomberg; Editing by Toby Chopra)
Reuters Messaging: william.schomberg.reuters.com@reuters.net)) By William Schomberg
LONDON, Feb 6 (Reuters) - Britain's construction sector
had its worst month in almost three years in January as rising
borrowing costs hit house-building hard but builders turned more
confident about the outlook for 2023, a survey showed on Monday.
The S&P Global/CIPS Purchasing Managers' Index (PMI) for the
construction sector dropped to 48.4 from 48.8 in December,
hitting its lowest level since May 2020.
Britain's construction sector lost its momentum during the
second half of 2022 in the face of higher interest rates. The
Bank of England last week raised borrowing costs to 4%, their
highest since 2008, in an attempt to tackle the surge in
inflation.
Monday's survey showed a sharp fall in house-building while
civil engineering work and commercial projects also declined.
But the construction PMI's gauge of business expectations
bounced back to its highest since July last year after touching
its lowest level since May 2020 in December.
Tim Moore, economics director at S&P Global Market
Intelligence, said some firms saw concrete signs of a turnaround
in new sales enquiries at the start of 2023.
"Other construction companies simply noted gradual
improvements in the general economic outlook and hoped that
confidence would return at a later stage this year," he said.
A measure of input cost inflation edged up slightly from
December's two-year low, but the new orders gauge was up only
fractionally from December's two-and-a-half year low.
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