UK construction in unexpected fall

City A.M. Reporter
Construction activity unexpectedly contracted in December for the first time since February 2010, the monthly Markit/CIPS purchasing managers index showed.

The PMI index dropped to 49.1 from November's unrevised reading of 51.8, a bigger drop than the fall to 50.9 which economists had forecast.

Readings below 50 indicate contraction and after the data sterling weakened against the dollar.

"Many constructors indicated that poor weather conditions had negatively impacted on activity, with new order growth accelerating slightly," Markit said. "Nonetheless, employment fell sharply, and confidence regarding future business prospects remained relatively weak," it added.

Residential construction contracted at its fastest pace since April 2009.