Building grows for first time in four months

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Construction is growing again for the first time since August as underlying activity in home building rebounds.

The monthly Ulster Bank Purchasing Managers' Index (PMI) finds that combined activity across three sectors - housing, commercial and civil engineering - rose in December to 52 from 48.2 previously.

The PMI registers growth above 50; the higher the number, the stronger the growth.

Today's headline figure includes a strong rebound in housing construction of 51.8 last month from 47.7 in November, when Brexit jitters spurred the first brief contraction in output since mid-2013.

Commercial construction, which dipped in the third quarter, accelerated to 53.6 last month, up from 51.2.

Long the laggard, civil engineering saw its decline moderate last month to 43.1 from 36.4 - nonetheless continuing a slump dating to mid-2018.

"Reduced Brexit uncertainty was cited as a source of support for the increase in overall activity at the end of 2019, while the improvement also reflected better performance across the three main sub-sectors," said Ulster Bank chief economist Simon Barry.

He said the rebound in housing construction supports "our view that the recent weakness in the housing PMI was perhaps more reflective of large, adverse, Brexit-related moves in business sentiment than of marked weakness in actual underlying housing activity".

The volume of new orders also returned to positive territory in December, while the pace of job creation and confidence in future activity both hit six-month highs.

Mr Barry said rising confidence was "underpinned by expectations of new projects in early 2020".

 

This article was first seen on https://www.independent.ie/business/commercial-property/building-grows-for-first-time-in-four-months-38855022.html

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