Construction boost helps ease fears of a double dip
The nation's builders saw new orders rise at the fastest rate in four and a half years last month, a survey said yesterday, further boosting hopes that the UK has dodged another recession.
The closely watched Markit/ CIPS purchasing managers' index survey for overall construction output, in which a reading above 50 represents expansion, rose to 56.7 in March from 54.3 in February - the sharpest expansion in 21 months.
A general improvement in market activity boosted tenders and saw long-running negotiations closed as new orders rose at their fastest rate since September 2007, Markit said. Growth was seen across all construction areas - civil, commercial and housing.
The upbeat survey comes after the equivalent reading for the manufacturing sector hit a 10-month high in March, adding to expectations that the economy returned to growth in the first quarter of 2012, after shrinking 0.3% in the final three months of last year.
The commercial sub-sector, which covers shop and office space, was the strongest performing, although civil engineering activity, such as London's Crossrail project, strengthened at its fastest rate in a year.
A slight increase in residential construction was recorded.
Chris Williamson, Markit chief economist, said the figures "raise hopes that the country has avoided a slide back into recession".
But he added: "Looking ahead, the lack of big new projects, such as Crossrail and the Olympics, means expectations about the year ahead continued to run well below the pre-crisis peaks."