- Tim Moore, Markit's chief economist
UK construction output unexpectedly declined sharply, even as growth in the previous months was upgraded and provided a slight boost to the British economic output in the third quarter. At the start of the final quarter of the year Britain's builders experienced an unexpected 2.2% decline in construction output in October. The drop slowed annual growth to 0.7%, the weakest level since May 2013, when Britain's housing market was starting a strong recovery, according to the Office for National Statistics. On a three-monthly basis, which strips out some of the volatility in the data, construction output growth fell 0.3%. For the whole third quarter, the data showed an upward revision from an 0.8% to a 1.6% increase. The ONS said that the revision contributed a 0.1 percentage point boost to the total gross domestic product, suggesting the economy grew by 0.8% between July and September, compared with 0.7% as previously thought. However, the whole third-quarter growth in the construction sector remained 7.2% below the pre-crisis peak of Q1 2008.
A tentative deceleration in the British construction was also shown in the Markit's PMI surveys for both October and November, when the corresponding PMI index declined to the lowest level in 13 months of 59.4 in November down from 61.4 in the previous month. Still, business activity has remained firmly above the contraction line for the nineteenth consecutive month.
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