LONDON - Growth in Britain’s construction industry slowed slightly in March, adding to signs that the economy has lost some of its strong momentum of late last year when it defied the shock of the Brexit vote, a survey showed on Tuesday.
The Markit/CIPS Construction Purchasing Managers’ Index (PMI) dropped back to 52.2 from 52.5 in February.
That was the joint slowest rate of growth since a recent pick-up for the sector began in September and was a touch weaker than the median forecast of 52.4 in a Reuters poll of economists.
Markit’s PMI survey of Britain’s manufacturers, published on Monday, showed growth among factories also weakened in March.
Britain’s economy outpaced all Group of Seven nations bar Germany in 2016, despite the decision by voters in June to leave the European Union. But it is widely expected to slow this year as rising inflation eats into consumer demand and businesses invest less.
Tuesday’s survey showed growth in housebuilding slowed to a seven-month low, more than offsetting the best month so far in 2017 for civil engineering firms who were helped by infrastructure spending. Commercial construction also picked up.
Inflation pressures, which have built since the Brexit vote because of the fall in sterling and higher oil prices, eased.
New orders remained at their lowest level since October, in part reflecting concerns about costs among customers, Markit said.
But expectations for future business, which hit a 13-month peak in January before falling back in February, rose.
Tim Moore, senior economist at survey compiler IHS Markit, said the cooling housing market appeared to be acting as a drag on the sector.
Construction accounts for around 6 percent of British economic output. Markit is due to publish its PMI for the far larger services sector on Wednesday. [ECONGB]
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Reporting by William Schomberg; Editing by Hugh Lawson