The UK construction activity posted its fastest expansion in nearly two-and-a-half years in September on improving output and new order growth amid falling interest rates, survey data from S&P Global revealed Friday.
The construction Purchasing Managers Index registered 57.2 in September, up from 53.6 in August. The reading was forecast to climb moderately to 53.1.
The index has remained above the neutral 50.0 threshold for the seventh straight month and the reading suggested the steepest rate of growth in 29 months.
All three sub-sectors of construction showed faster rates of output growth. Civil engineering was the best-performing category. Commercial building gained momentum with output rising to the greatest extent since May.
Respondents cited that lower borrowing costs and domestic political stability provided positive impetus to client spending. Further, improving market conditions and rising confidence helped to boost house building in September. The latest upturn in residential work was the fastest since March 2022, the survey showed.
Total new orders grew the most in two-and-a-half years in September and greater workloads encouraged firms to recruit more staff.
Input buying increased at the one of the fastest pace seen since early 2022. Suppliers delivery times shortened again in September.
Input prices increased at the steepest rate since May 2023. Rates charged by subcontractors increased only marginally and at the slowest pace so far in 2024.
Business activity expectations for the year ahead remained upbeat in September despite slipping to the lowest since April.