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British construction growth still "strong" despite bad weather in February: economists

English.news.cn   2014-03-05 03:36:27

LONDON, March 4 (Xinhua) -- Economists said Tuesday that growth in the British construction was "strong" in February despite being dented by bad weather.

The Purchasing Managers' Index (PMI) for construction continued its strong recent run, but eased back to 62.6 in February after jumping to 64.6 in January from 62.2 in December (above 50 is growth).

Commercial activity was still at a robust level despite also easing back from January's highest level since 2007.

Output rose for the 10th consecutive month and new orders continued to grow, also for the 10th successive month.

Howard Archer, chief British economist with IHS Global Insight, said, "the survey points to the construction sector sustaining very strong activity in February, although there was some hit to housebuilding, in particular, and commercial activity coming from the very wet weather and flooding."

"This was partly offset by increased civil engineering and infrastructure work related to tackling the flood damage," Archer added.

Archer said "this is still a very strong survey" even if activity had not been affected at all by the wet weather and flooding.

"Indeed, construction activity was still reported to be at one of its highest levels since 2007 with incoming new business still at elevated levels despite reports that the unusually wet weather had some disruptive impact on sales during February. Business expectations are also strong." He said.

The construction sector is also likely to be a net gainer from the floods and bad weather, with any lost construction activity in February from the bad weather and flooding merely delayed rather than lost, while the sector will benefit months from rebuilding and repair work after the floods.

Archer said, "All the signs are that the construction sector's upturn remains very much intact. There are also reports that infrastructure projects are increasingly kicking in."

There was also good news in the figures for commercial property construction.

Kelvin Davidson, property economist with Capital Economics in London, said, "Today's PMI showed that commercial property construction growth slowed a little in February. But it is still growing rapidly and suggests that developers are very confident about the prospects for occupier demand and rents."

The PMI for commercial property construction dipped from 64 in January to 60.6, the first time that development failed to improve month-on-month since February last year.

"But this is hardly a concern, given that the latest reading still highlighted solid growth," said Davidson.

Davidson said the overall message from today's PMI was "positive" and, that rents will increase by about 2 percent in 2014, the best calendar-year figure since 2007.

Editor: An
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