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Investing.com -- The British construction sector experienced a notable contraction in January, marking the first such decline in almost a year, according to a recent survey, which also highlighted escalating cost pressures within the industry.
The S&P Global/CIPS UK Construction Purchasing Managers’ Index, a key measure of activity among British construction firms, decreased to 48.1 in January.
This is a significant drop from December’s 53.3. Notably, this contraction was unexpected, falling below expectations of 53.5.
The contraction in the construction sector is a clear indication of a slowdown in activity.
The Purchasing Managers’ Index (PMI) is an important indicator of economic health, with a reading above 50 indicating expansion in the sector, while a reading below 50 signals contraction. The drop to 48.1 in January, therefore, signifies a contraction in the sector.
Alongside this contraction, the survey also highlighted the issue of increasing cost pressures within the industry. This suggests that construction firms are facing rising costs, which could impact their operations and profitability.
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