Eurozone Construction PMI rose in February - IHS Markit

February PMI data from IHS Markit pointed to the fastest expansion in eurozone construction activity for a year, supported by increased worker numbers and elevated input purchases. Moreover, firms were their most optimistic towards the business outlook since last June. However, positive results came amid a softer expansion in new orders.

Up from 51.9 in January, to 52.5 in February the Eurozone Construction PMI pointed to a faster expansion in construction activity across the currency area. In fact, the latest rise was the quickest for a year, underpinned by accelerated growth in Germany and a slight rebound in Italy. On the other hand, France recorded a slower increase for the second month in a row, with the latest expansion only fractional overall.

At the sub-sector level, overall growth was supported by home building and commercial construction projects which both increased at quicker rates compared to January. Meanwhile, although civil engineering work continued to decline, the pace of reduction was the slowest in the current seven-month sequence of contraction.

Amid a further rise in activity, eurozone construction firms continued to increase their staff numbers in February. Moreover, the rate of job creation accelerated to the quickest for almost a year.

Similar to the trend in employment, purchases of raw materials and other building inputs grew at a quicker pace, extending the current run of acceleration to three months. At the national level, the result was predominantly driven by a sharp expansion in Germany. Faster activity growth across the eurozone construction sector came despite a softer rise in new business during February. The latest rise was only marginal overall and the slowest since a decline last September.

Finally, eurozone building companies remained optimistic towards the one-year business outlook. Moreover, the degree of positivity strengthened to the highest level for eight months, supported by improved confidence in Germany and Italy