Bounce-back for builders

BUILDERS bounced back in October as output hit a five-month high.

Construction companies in Britain noted a slump over the summer, as rising prices and concerns over the economy stymied buying activity.

But the commencement of new projects and high numbers of unfinished work bumped up the construction sector’s reading on S&P Global’s Purchasing Managers’ Index (PMI) to 53.2.

This was above the crucial 50 reading which marks no change, and the highest since May.

Commercial building was the strongest performer, while residential work also expanded. Civil engineering decreased for the fourth month running.

But there were still storm-clouds over the sector, as business expectations dropped to a 29-month low.

Firms said weaker confidence among clients, rising prices of materials, higher borrowing costs and a drop in work due to political uncertainty were all acting as drags on activity. Higher costs were ‘overwhelmingly linked’ to energy bills, fuel and rising wages, S&P added.