FX.co ★ UK Construction Activity Falls for 12th Straight Month

The S&P Global UK Construction PMI slightly improved to 40.1 in December 2025, rising from the over-five-year low of 39.4 recorded the previous month. Despite this marginal increase, the figure continues to represent a full year of monthly contractions, marking the second-most significant decline since the sector was impacted by the Covid pandemic. Companies have attributed this downturn to weakened client confidence, leading to a pronounced decrease in new orders to replace those projects that have been completed. Respondents also mentioned that investment decisions by clients are being delayed due to uncertainties surrounding the potential impacts of the UK's new Budget on their sales strategies. Civil engineering activity experienced a steep decline (32.9 compared to 30 in November), and both housing activity (33.5 compared to 35.4) and commercial construction (42 compared to 43.8) have also faced their most significant drops since May 2020. Nonetheless, more than one-third of the sector anticipates improved conditions in the coming year, with optimism fueled by anticipated new projects in the utilities sector and the anticipated broad support from lower interest rates.