LONDON (Reuters) – Growth in Britain’s construction industry sped up sharply in July after the Labour Party’s landslide election win, with activity growing at the fastest pace in more than two years, according to a survey published on Tuesday.
The S&P Global UK Construction Purchasing Managers’ Index leapt to 55.3 – the highest since May 2022 – from 52.2 in June and far above the median forecast of 52.8 in a Reuters poll of economists.
“The election-related slowdown in growth seen in June proved to be temporary, with the pace of expansion roaring ahead in July,” Andrew Harker, economics director at S&P Global Market Intelligence, said.
New Prime Minister Keir Starmer has said his government will focus on speeding up the economy after Labour won the July 4 parliamentary elections.
Last week, the Bank of England cut interest rates from a 16-year high of 5.25% and investors expect two further quarter-point reductions in borrowing costs before the end of the year.
The pickup in the construction sector in July was led by new orders which put fresh strain on supply chains and inflationary pressures built, the PMI survey showed.
Civil engineering provided the biggest boost to the sector but residential and commercial building work also both grew.
The wider all-sector PMI, which includes results from the surveys of the larger services and manufacturing sectors which were published in recent days, rose to 53.1 from 52.3 in June.
(Reporting by William Schomberg; Editing by Susan Fenton)
