Construction sector slump after disappointing December

Construction contracted in December. Photo: Rui Vieira/PA Wire

The construction sector contracted at its fastest rate in six months in December driven by house building being at its lowest in two years.

ITV News Economics Editor Richard Edgar reports:

The Markit/CIPS Construction Purchasing Managers' Index (PMI) - which gives an early indication of output in the sector - fell to 48.7 last month from 49.3 in November. Anything below 50 signals contraction.

Forecasters had predicted a reading of 49.5 but the index is at its lowest since June, when poor weather and extra public bank holidays dented output.

Construction only accounts for 7 per cent of Britain's GDP but its troubles reflect the weakness in the wider property sector.