Investing.com - The U.K. construction sector shrank for the first time in 13 months in September, underlining concerns over the economy and dimming the case for higher interest rates, industry data showed on Tuesday.
Market research firm Markit said that its U.K. construction purchasing managers' index fell to a seasonally adjusted 48.1 last month from a reading of 51.1 in August. Economists had expected the index to dip to 51.0 in September.
On the index, a reading above 50.0 indicates expansion, below indicates contraction.
September data revealed a difficult month for the U.K. construction sector, as a sustained drop in new work led to the first reduction in overall business activity since August 2016.
Survey respondents attributed the drop in workloads to fragile confidence and subdued risk appetite among clients, especially in the commercial building sector.
Commenting on the report, Tim Moore, Associate Director at IHS Markit and author of the report, said, " Aside from the soft patch linked to spending delays around the EU referendum, construction companies have now experienced their longest period of falling workloads since early-2013."
GBP/USD was trading at 1.3255 from around 1.3280 ahead of the release of the data, while EUR/GBP was at 0.8856 from 0.8842 earlier.
Meanwhile, European stock markets were mostly higher. London’s FTSE 100 ticked up 0.1%, the EURO STOXX 50 rose 0.1%, France's CAC 40 added 0.2%, while Germany's DAX was closed for a public holiday.