Eurozone construction PMI falls to all-time low in April amid COVID-19 pandemic

According to the report from IHS Markit, the Eurozone Construction Total Activity Index fell even further in April, following the substantial drop in March. At 15.1, the figure recorded a new record low, falling from 33.5 in March, signalling an unprecedented month-to-month decline in construction activity across the eurozone. Survey data showed Italy and France recorded extreme contractions in construction output, while Germany registered a far slower decline but one that was still marked overall.

April data showed a substantial fall in home building activity across the eurozone following a marked decline in March. The rate of contraction was the fastest seen in the over 20-year survey history, led by France and Italy, which reported extreme rates of decline.

Work undertaken on commercial construction projects in the eurozone likewise contracted at a severe pace in April, as indicated by the respective seasonally adjusted index registering significantly below the no-change 50.0 level. The rate of decline was unprecedented in over 20 years of data collection.

Despite substantially reduced purchasing demand, supply chains remained under pressure. Delivery times lengthened to the greatest extent in the series history and at a rate that was severe overall. Cost burdens faced by eurozone construction firms rose further in April. However, the rate of inflation was the slowest for just over four years.

Finally, eurozone building companies remained pessimistic about future activity in April, with the Future Activity Index coming in well below the neutral 50.0 level. Concerns over the economic impact of the COVID-19 pandemic on construction activity were commonly mentioned.