3 January 2007, 13:41  UK Dec construction sector PMI rises to 57.5

UK construction sector growth accelerated at the end of December, helped by a buoyant commercial sub-sector, the Chartered Institute of Purchasing and Supply said. The headline purchasing managers index reached 57.5 in December, its highest since October. In November, the index was at 54.8. A reading above 50 indicates expansion. The fastest growth was reported in the commercial sector, with the seasonally adjusted commercial activity index rising to 58.1 from 54.6 in November. New orders reached 56.0 from 53.8 while employment levels were also up. "Growth in the UK construction sector continued in December with commercial activity experiencing the fastest rise. The main issue facing UK construction firms was the sharp rise in input price inflation. Many panellists reported rising energy costs and higher prices for various raw materials in December," said Roy Ayliffe, director of professional practice at CIPS. "However, as we look forward to this year, purchasing managers remain optimistic that growth will continue with orders and planned company expansions helping to increase confidence," he added. UK construction firms were more optimistic about the future in December compared with the previous month. The seasonally adjusted future business activity index rose to 72.6, up from November's 71.9. Anecdotal evidence suggested that planned company expansions, in addition to anticipated growth in volumes of new orders, had underpinned optimism at the end of 2006, CIPS said.

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