UK October construction PMI 54.3 vs 55.5 expected

• Construction PMI 54.3 vs 55.5 expected and 57.2 prior.

Key findings:

• Civil engineering remains best-performing
  category, followed by commercial work.
• Renewed decline in house building.
• Business optimism slips to ten-month low.

Comment:

Tim Moore, Economics Director at S&P Global Market
Intelligence, said:

“The construction sector signalled another month of
solid output growth in October, despite being unable to
match the highs seen in September. Business activity
expansion was once again led by civil engineering work.
Survey respondents widely commented on strong
demand for renewable energy infrastructure projects.

Commercial construction activity also increased
again, albeit at the slowest pace since the current
phase of expansion began in April. Improving domestic
economic conditions helped to boost demand, but some
construction companies reported delayed spending
decisions ahead of the Autumn Budget. October data
meanwhile indicated a decline in overall residential
construction activity for the first time since June.

Government policy uncertainty, fragile consumer
confidence and elevated borrowing costs were all
constraints on demand for house building projects.
Total new work expanded at a solid pace in October,
adding to signs of a robust improvement in order book
pipelines across the construction sector in the second
half of 2024.

As a result, construction companies
added to their payroll numbers at an accelerated
pace. However, business optimism remained relatively
subdued in comparison to the highs in the first half
of the year, with output growth expectations now the
lowest since December 2023.”