Index shows growth in construction sector

The rate of growth in the construction industry has quickened to a seven-month high.

The Ulster Bank Construction Purchasing Managers' Index out today, rose to 60.5 from 54.6 in January leaving it significantly above the 50 no-change benchmark, and it has now risen every month since September 2013.

The strengthening performance in February was driven by more residential construction.

Ulster Bank Chief Economist Simon Barry said: “The Housing PMI picked up to its highest level since May of last year pointing to a welcome strong start to 2019 for housing construction. Commercial activity also recorded a marked acceleration with its PMI also reaching a nine-month high.

“Encouragingly, respondents reported a marked pick-up in new business, with the new orders index rising to a very elevated reading of 60.2 in February, marking an eight-month high."

Mr Barry said it is good news for the economy:

"In turn, strong activity and order flows continue to underpin robust demand for construction workers, with the pace of job creation matching a seven-month high in February. Sentiment among firms about the sector’s prospects over the coming 12 months remained solidly positive at levels well above its historic average as firms continue to cite the supportive influence of solid trends in new orders and the ongoing improvement in economic conditions.

"However, confidence levels did slip back last month reflecting some concern about downside risks to customer demand – perhaps an indication that elevated levels of economic uncertainty are weighing on firm’s perceptions of the outlook.”

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