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Construction output rises, PMI says

Construction output rose to a five-month high in October, buoyed by commercial and civil engineering projects, a survey of purchasing managers says.

The Markit/CIPS Construction Purchasing Managers’ Indexscored 53.9 in October, up from 50.1 in September. A result of 50 indicates no change.

However, confidence in future business activity was at its lowest for nearly three years. At 54.1 construction buyers were broadly optimistic, but less so than any time this year.

The commercial sector showed the greatest rise in activity at 54.6, while civil engineering was also positive at 50.5. Housing activity fell, at 49.3, but at a lower rate than in September.

Sarah Bingham, economist at Markit and author of the UK Construction PMI said: “UK construction output improved in October, as new orders recovered from September’s modest decline.

“The outlook for the sector remains uncertain, with October seeing a further weakening in sentiment regarding business expectations; confidence was at its lowest level since December 2008. Furthermore, the increase in employment recorded was fractional, despite the rise in new business and activity. This suggests that constructors remain tentative about the longevity of the sector’s growth profile.”

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