Irish Construction: Fastest rise in new business for decade - not level activity
Irish Construction: The latest construction PMI (purchasing managers' index) survey shows the fastest rise in new business for decade - however do not confuse a rise with level of activity.
For more on PMI here: The idiot/ eejit's guide to distorted Irish national economic data
Markit says: "The recovery in the Irish construction sector gathered pace in October, with near-record rises in activity, new orders and employment all seen during the month."
This is a sentiment survey and it doesn't mean that activity is back to boom-time peaks and no data is released on the number of firms polled.
Companies remained optimistic that activity will continue to expand over the coming year. On the cost front, a further marked rise in input prices was registered. The Ulster Bank Construction PMI – a seasonally adjusted index designed to track changes in total construction activity – rose to 64.9 in October from 61.5 in the previous month. The reading was the second-highest since the survey began in June 2000, with November 2004 the only month to have seen a faster expansion. Increased new orders and improving economic conditions had been the main factors leading activity to rise.
Simon Barry, chief economist Republic of Ireland at Ulster Bank, said: "The pace of growth in Irish construction accelerated markedly in October, according to the results of the latest Ulster Bank Construction PMI survey. The headline PMI index rose again last month, reaching the second highest level in the survey’s fourteen year history - the latest sign that the recovery in the sector is continuing to strengthen, albeit from very low levels of activity. Both housing and commercial activity registered another month of particularly rapid rises, with the latter posting its strongest gain in over nine years. And a return to marginally positive growth in civil engineering meant that survey respondents are reporting a broadening, as well as a strengthening, of the sector’s recovery dynamic.
For the first time since October 2006, each of the three monitored sectors posted rises in construction activity. This was due to a return to growth of civil engineering activity, albeit only a marginal increase. Both the housing and commercial sectors posted further substantial expansions of activity during October. The rise in commercial activity was the strongest since September 2005."
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