U.K. Construction Posts Worst Month Since 2009 on Brexit Worries
U.K. construction output fell at the fastest pace since the financial crisis in June as demand took a hit from Brexit woes.
(Bloomberg) -- U.K. construction output fell at the fastest pace since the financial crisis in June as demand took a hit from increased political and economic uncertainty.
IHS Markit’s index of activity tumbled to 43.1 last month, defying economist expectations for a small increase. June saw the fastest drop in house building in three years, a sixth consecutive fall in commercial work and the worst month for new orders in more than a decade, Markit said.
The headline index was down from 48.6 in May, and below the 50 threshold that indicates expansion for the fourth time in five months. The reading, the worst since April 2009, follows a similarly downbeat report for the manufacturing sector on Monday, which showed the sharpest contraction since 2013.
The reports underscore the toll Brexit uncertainty is taking on the U.K. economy as the nation heads for its new exit date of Oct. 31 amid growing concerns of a no-deal departure.
The Office for National Statistics reported that the economy shrank 0.4% in April, as the impact of stockpiling before the original deadline evaporated, and the Bank of England expects no growth in the second quarter as a whole.
Markit will release a similar gauge for the U.K.’s dominant services industry on Wednesday.
To contact the reporter on this story: David Goodman in London at dgoodman28@bloomberg.net
To contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Brian Swint
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