LONDON, March 4 The strong pace of growth in
Britain's construction sector
eased off last month, hurt by heavy rain and floods which
affected house-building, a survey showed on Tuesday.
The Markit/CIPS construction PMI slipped to 62.6 in February
from 64.6 in January - which was its highest level since August
2007. A Reuters poll of economists had forecast the index would
fall to 63 in February.
Purchasing managers who took part in the survey said the
adverse weather hit house-building in particular which remained
strong but grew at its slowest pace in four months.
By contrast, civil engineering activity saw its strongest
month since April 1997, helped by higher spending by local
authorities which in some cases was in response to the rain.
Job creation was at its highest in three months as 59
percent of construction companies expected a rise in output over
the year, compared with only 10 percent predicting a fall.
Britain's construction industry was hit hard by the
financial crisis of 2007-09. But it has been recovering since
last year thanks to a combination of record low interest rates,
government programmes to encourage people to buy new homes and
There were signs of price pressures in the industry's supply
chains which have barely had a chance to expand after the slump.
The overall rate of input price inflation picked up from a
five-month low in January and sub-contractor rates grew at their
fastest pace on record.
"Strong demand is continuing to put pressure at a supplier
level, with vendors battling with low stocks and prices
increasing as a result," said David Noble, chief executive at
the Chartered Institute of Purchasing & Supply.
He said delivery times were still getting longer but at the
slowest rate since August, "suggesting that the very worst of
the squeeze has passed."
The construction sector accounts for about 7 percent of
Britain's gross domestic product.
Bank of England Governor Mark Carney has said the economy
might suffer a temporary hit caused by the rain and floods.
The pace of growth in Britain's manufacturing sector picked
up a touch in February, a similar survey showed on Monday.
(Reporting by David Milliken; Editing by Toby Chopra)