Construction expands for two straight months for first time since May 2012

Construction orders have improved in June, according to new data from Markit, which sees the purchasing manager's index (PMI) for the sector rise from 50.8 to 51.0 (51.2 expected).

This is now the second consecutive month of expansion for the sector, last seen in May 2012.

Tim Moore, Senior Economist at Markit and author of the Markit/CIPS Construction PMI, said:

June’s construction data is one of the final pieces in the puzzle when it comes to survey evidence for second quarter UK economic performance, and the sector’s upturn adds to the upbeat news flow ahead of Mark Carney’s first policy meeting at the Bank of England later this week.

The improvement in overall construction output simultaneously raises chances of strong second quarter UK GDP growth, and reduces the likelihood of imminent additional policy stimulus from the Bank of England.

Jeremy Cook, chief economist at the currency company, World First:

Combine this with yesterday’s strong manufacturing numbers, and the expected good Services Sector data due out tomorrow, and we can all feel a lot more comfortable about pencilling in much stronger growth number for Q2 than we got in Q1.

Mark Carney has the gift of good timing it seems, and these positive figure will also probably delay any ‘monetary activism’ from the new man in Threadneedle Street.

Howard Archer, chief UK & European economist, IHS Global Insight:

We very much doubt that this growth rate can be sustained for long given still significant domestic growth headwinds and an uncertain global economic environment. Nevertheless, with the economy currently showing widespread improvement, we believe the chances have significantly improved that the UK can achieve sustained modest growth through the second half of the year and beyond.