UK construction sector output was flat between June and July, pulling year-on-year growth down to its weakest rate since November 2013, official figures have shown.
An easing of growth of housebuilding activity, which has been expanding at a heady pace amid a raft of government measures to fuel the UK residential property market, played a part in the Office for National Statistics' flat construction figures for July.
The stagnant month-on-month picture painted for July by the ONS figures contrasts with strong monthly growth rates recorded by surveys of the construction sector published by the Chartered Institute of Purchasing and Supply.
However, the official figures, while showing year-on-year growth in construction output more than halved from 5.3 per cent in June to 2.6 per cent in July, showed orders for new work rising at the fastest quarterly pace in a year.
The figures revealed new orders in the construction sector rose by 3.8 per cent between the first and second quarters. The ONS had in June reported a 6.3 per cent quarter-on-quarter fall in new orders in the opening three months of 2014.
The rebound in new orders in the three months to June should bode well for construction activity in coming months. And senior figures in the Scottish construction sector were encouraged by the data.
Brian McQuade, managing director of construction company Kier's business in Scotland and north-east England, said: "The stability in the construction output figures is positive news for an industry that has demonstrated increased buoyancy in recent months.."
Ed Monaghan, chair of industry body Construction Scotland, said: "[The] statistics from ONS confirm what we have been seeing throughout the industry in Scotland for the past few months - buoyancy within the sector, increased client and industry confidence and an increasingly bright future."
Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "Construction output was somewhat disappointingly only flat in July after rebounding 1.2 per cent month-on-month in June from a drop of 1.2 per cent in May.
"Construction output still looks likely to see decent expansion in the third quarter and to contribute to GDP (gross domestic product) growth, having been only flat in the second quarter."
He added: "Prospects still look relatively healthy for housebuilding even if the growth rate will struggle to match the heady level seen earlier this year. Housing market activity has slowed but should remain decent going forward while the government is looking to support housebuilding."
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