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Infrastructure orders rise in three months to June - but construction overall remains mixed

Infrastructure orders in the three months to June 2009 rose by 4% compared with the previous three month period, and rose by 27% when compared with the same three month period a year earlier, official figures have revealed.

Orders in the year to June 2009 rose by 14% compared with the previous 12 months.

The figures, published today by the Office of National Statistics, provide some good news for the infrastructure sector. But the good results were not repeated across the industry.

Overall, orders in the three months to June 2009 rose by 18% compared with the previous three month period. But orders in the 12 months to June 2009 fell 27% compared with the previous 12 months and orders in the three months to June 2009 fell by 21% compared with the same period a year earlier.

All orders figures quoted are seasonally adjusted and in constant (2005) prices.

Commenting on the ONS data on new construction orders, RICS chief economist Simon Rubinsohn said:Provisional data released this morning shows the monthly volume of new construction orders slipped back in June to a fresh low for the cycle. The latest reading, while clearly still an early estimate and likely to be revised, provides a timely warning about the health of the construction sector in the face of better news emanating from elsewhere in the economy. The latest number was dragged down by particular weakness in the infrastructure, public non-housing and private housing sectors.

“For the whole of the second quarter, which is a better way to view what is notoriously volatile data, new construction orders were 18% up on a very weak first quarter. However they were still more than 21% lower than in the same period of 2008. Against this backdrop, the likelihood is that the actual level of construction output should begin to stabilise in the latter part of this year with a modest pick-up in the hard numbers in 2010.”


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