UK construction January PMI stuck at lowest since June

The Markit/CIPS Construction Purchasing Managers' Index (PMI) held at the 48.7 level plumbed in December. That was its lowest level since last June.

The reading, below the 50 mark that would indicate no change in output, fell short of economists' forecasts of an improvement to 49.1.

Weak construction output, which accounts for less than 7 percent of Britain's gross domestic product, was the main drag on the economy last year, helping tip the country back into recession.

Some firms reported that unusually heavy snow depressed activity last month, Markit said, but weak demand and lack of new projects were cited as the main reasons for lower output.

House-building and civil engineering activity both fell, while commercial construction was little changed.

"January's survey results are yet another indicator of the severe underlying fragility across the UK construction sector," said Tim Moore, senior economist at survey compiler Markit.

"Unfavourable weather outside is clearly far down the long list of difficulties afflicting construction companies at present," he added.

There were some brighter signs for the sector, however. Business optimism rose and a protracted decline in new orders slowed sharply.