UK construction PMI surprises positively, rebounds to 17-month high in May

The construction sector activity in the UK economy staged a solid comeback and surprised markets to the upside in May, a fresh report from Markit Economics showed on Friday.

The final Purchasing Managers' Index (PMI) in the UK rebounded unexpectedly to 56.0 points in May, after having booked 53.1 points in April. Markets had predicted a 52.7 reading.

Key Points:

Business activity rises at fastest pace since December 2015

Residential work replaces civil engineering as best performing category

Input cost inflation moderates to seven-month low

Tim Moore, Senior Economist at IHS Markit and author of the Markit/CIPS Construction PMI®, noted: “May’s survey data reveals that the UK construction sector has started to recover strongly from its slow start to 2017. “House building was the key growth driver, with work on residential projects rising at the fastest pace since December 2015. A sustained rebound in residential building provides an encouraging sign that the recent a soft patch for property values has not deterred new housing supply.”