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a construction website in LondonA building web site in London Photograph: Daniel Leal-Olivas/AFP/Getty photographs

Construction task recovered in August, reversing all of the slump observed in the instant aftermath associated with the Brexit vote.

Production fell for a third month, nevertheless the pace of decrease slowed markedly. The construction PMI (pdf) from Markit/CIPS hopped to 49.2 in August from 45.9 in July. The reading ended up being much better than the 46.1 figure expected by City economists. The 50 level distinguishes growth from contraction: everything below indicates contraction.

Tim Moore, senior economist at Markit and author of the Markit/CIPS Construction PMI, stated: “The downturn in UNITED KINGDOM construction task features eased significantly since July, mainly helped by a much reduced decrease in commercial building. Building firms cited a nascent recovery in customer self-confidence because the EU referendum result and a somewhat constant flow of invites to tender in August.

“However, the latest survey indicates only a partial move towards stabilisation, without a come back to business as usual across the building industry. There Have Been still widespread reports that Brexit doubt had dampened need and slowed development on in the offing improvements, particularly in reference to large projects.”

New order volumes continued to-fall during August, which contrasts because of the three-year run of sustained development seen before might.

UK construction activity. Example: Markit/CIPS

Mike Chappell, of Lloyds Bank commercial banking, said: “The previous thirty days has seen several of the larger players in industry report powerful outcomes with a somewhat positive outlook, suggesting indeed there may have been less unfavorable effect from EU referendum outcome than had been initially feared, at the very least near the top of industry.

“The purchase books of bigger organizations, some of which reap the benefits of diversified income streams, look like who is fit, while several have actually either increased or restored their particular dividends. Having said that, anecdotal evidence suggests those more along the string – including mid-tier contractors and SMEs – are less bullish plus more likely to adopt a ‘wait-and-see’ strategy.”

Chappell said businesses is following closely various data to better gauge the wellness of the economic climate. “Firms may taking into consideration the chancellor’s future autumn statement when they will learn whether their hopes of an increase in infrastructure spending are in order to become a real possibility.”

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