LONDON — Britain’s construction sector expanded for another month in March, but the pace of that expansion slowed once again, according to the newest PMI survey released on Tuesday morning.
IHS Markit and CIPS’ latest PMI release for the construction sector — which measures expectations of growth — came in at 52.2 for the month of March.
That was down from the 52.5 reading in February, and lower than the 52.4 forecast by economists prior to the release.
“March data revealed a slowdown in growth across the UK construction sector, led by a weaker rise in residential building activity,” IHS Markit said.
The purchasing managers index (PMI) figures from IHS Markit are given as a number between 0 and 100.
Anything above 50 signals growth, while anything below means a contraction in activity — so the higher the number is, the better things look for the UK.
Construction PMIs collapsed in the immediate aftermath of the UK’s vote to leave the European Union, but as the dust settled the ship steadied somewhat in August, before returning to growth in September, shocking economists. That expansion had continued in early 2017, but now appears to be tailing off as the realities of Brexit start to bite.
“UK construction firms experienced a growth slowdown in March, with the loss of momentum centred on housebuilding. A weaker trend for residential work has been reported throughout 2017 so far, which provides an indication that the cooling UK housing market has started to act as a drag on the construction sector,” Tim Moore, a senior economist with IHS Markit said in a statement.
Here is the chart, showing March’s reading in the longer term trend:
The construction PMI follows on from a weaker than expected figure from the manufacturing sector on Tuesday. The sector saw a reading of 54.2. That was a continued expansion but marks a miss on forecasts from economists, and was lower than the previous reading of 54.5 in February.
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