The latest S&P Global UK construction purchasing managers’ index (PMI) for January registered 46.4, indicating an improvement compared to previous months, though the sector remains below the 50 mark that separates growth from contraction. This reading suggests the construction industry is beginning to stabilize after a period of decline.
Despite the overall improvement, housebuilding continues to underperform relative to other construction activities, reflecting ongoing challenges in the residential market.
**Why this matters**
The PMI is a key indicator of economic health in the construction sector. An index below 50 signals contraction, so the rise to 46.4 points to a slowing in the sector’s decline, which could signal a gradual recovery. However, persistent weakness in housebuilding may impact broader economic growth and housing supply.
Source: NewsData