LONDON (Reuters) – Growth in Britain’s construction industry slowed to a crawl in November as high borrowing costs and the gloomy economic outlook weighed on construction work, a survey showed on Tuesday.
The S&P Global/CIPS UK Construction Purchasing Managers’ Index (PMI) fell to a three-month low of 50.4 from 53.2 in October, just above the 50 dividing line between growth and decline.
A Reuters poll of economists had pointed to a reading of 52.0.
The residential construction sector stagnated while civil engineering activity deteriorated. The survey’s gauge of future activity fell to its lowest level since the start of the COVID-19 pandemic, marking a recession.
“Survey respondents found that new housing projects were curtailed in response to rising interest rates, canceled sales and concerns about the economic outlook,” said Tim Moore, chief economic officer at S&P Global, which compiles the survey.
The Bank of England raised interest rates to 3% in November from 0.1% a year ago and is expected to raise them again this month.
As demand from the economy slackens, various consumer and business price pressure measures have eased — including in Thursday’s survey.
The construction purchase price index fell in November to its lowest level since January 2021.
The all-sector PMI, which combines Tuesday’s construction data with last week’s manufacturing and services surveys, fell to 48.4 in November from 48.7 in October — the lowest since January 2021, when the largest Part of the UK was in a COVID-19 lockdown.
(Reporting by Andy Bruce; Editing by Toby Chopra)
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