At 53.1 in June, down from 54.9 in May, the Ulster Bank Construction Purchasing Managers’ Index (PMI) has signalled the weakest rise of Irish construction activity for eight months. That said, the rate of activity growth was solid and faster than the long-run series average.
Commenting on the survey, Simon Barry, Chief Economist Republic of Ireland at Ulster Bank, noted that: “The Irish construction sector continued to enjoy rising activity levels as Q2 drew to a close. However, the June results also point to a further slight loss of momentum in the growth rate of construction activity as the headline PMI eased to 53.1 in June from 54.9 in May. That still leaves the sector comfortably in expansion territory, albeit that the June reading marked the slowest pace of growth in eight months. This cooling reflects weaker activity patterns across commercial and civil engineering. Commercial activity remains in expansion mode, but a fourth consecutive decline left the commercial PMI at a near six-year low in June. More encouragingly, the residential sector continues to perform strongly with the pace of Housing activity growth holding steady at very solid rates – a very welcome sign of sustained expansion in a key part of the sector.
“Respondents also reported a notable pick-up in the pace of job creation, with the employment index rising to a very solid reading of 56 in June, up from May’s four-year low of 53.5. Furthermore, firms themselves remain optimistic about the coming year. While sentiment eased back a little last month, almost 40% of respondents are anticipating higher output levels in the coming 12 months, with stronger economic conditions expected to result in further increases in demand for construction work.”
Irish Construction Industry Magazine