- Tim Moore, senior economist at Markit
Activity in the British construction sector slowed more than expected in October, recording the slowest growth in five months, as signs of a slowdown in the housing market caused a decline of building of new homes. The Markit/CIPS UK construction PMI dropped to 61.4 in October, compared with 64.2 a month earlier, and coming in against economists' forecast for a decline to 63.5. Nevertheless, the gauge is still well above the 50-mark threshold, which indicates expansion in the construction sector that accounts for around 6.3% of the nation's gross domestic product. The data still marks the twelfth successive monthly reading above 60, pointing to a sector that remains positively upbeat. The UK's Construction Products Association has projected growth in the sector of around 5.4% in 2015, which is twice the rate of UK economic growth as a whole, which is currently expected by the British Chamber of Commerce to come in at 2.7% for the same period. The Association foresees a 23% expansion in the construction sector between now and the end of 2018.
The construction data follows the recent manufacturing PMI, which surprisingly rose at the start of the final quarter, with the headline figure climbing to 53.2, up from 51.5 in September. Markit's data on the services sector, which makes up 78% of GDP, is due on November 5.
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