Investing.com - UK construction sector activity eased slightly in December, missing forecasts and dampening optimism over the British economy, industry data showed on Wednesday.
In a report, market research firm IHS Markit and the Chartered Institute of Purchasing & Supply (CIPS) said that their UK construction purchasing managers' index dropped to a seasonally adjusted 52.2 last month from November’s reading of 53.1.
Economists had expected the index to drop to only 52.8 in December.
On the index, a reading above 50.0 indicates expansion, below indicates contraction.
IHS Markit highlighted that housing continued to be the best performing area of activity and new orders rose at the fastest pace since May.
The research group also indicated that the sharp rate of input price inflation continued in December.
“Construction firms indicated that longer-term business confidence is still relatively subdued, largely reflecting concerns about the domestic economic outlook,” IHS Markit associate director Tim Moore commented in the report.
He explained that only 37% of the survey panel forecast a rise in construction activity over the course of 2018, while around 11% anticipated a reduction.
“As a result, the balance of UK construction companies expecting growth in the year ahead remains among the weakest recorded by the survey since mid-2013,” Moore concluded.
Following the report, GBP/USD traded at 1.3586 compared to 1.3592 ahead of the release, EUR/GBP was at 0.8859 compared to 0.8857 earlier, while GBP/JPY traded at 152.60 compared to 152.65 previously.
Meanwhile, London’s FTSE 100 lagged European markets with slight losses of 0.07% while the Euro Stoxx 50 rose 0.09%, France's CAC 40 traded up 0.09% and Germany's DAX advanced 0.22%.