By Dearbail Jordan

Activity in the construction sector slumped to a record low during July, as conditions in the British housing market continued to deteriorate to unprecedented levels.
According to the Construction Managers’ Index, which measures trends in the housing, commercial and civil engineering sector, its reading of the industry fell to a new series low of 36.7.
The worst decline was recorded in housing, where activity fell to just 18.7 during July — the eighth successive monthly fall.
Any figure below 50.0 indicates a contraction in activity and the index’s measurement of new orders in July revealed a fall to a new low of 41.0.
At the same time, conditions worsened due to the rising cost of raw materials, and the Construction Managers’ Index recorded a reading of 79.0 after nearly two thirds of companies recorded a rise in input costs.
The alarming figures were released just three days before the Bank of England’s Monetary Policy Committee (MPC) is due to announce its decision on interest rates. The current cost of borrowing is 5 percent, and the MPC is widely expected to keep rates unchanged.
However, a few commentators have suggested that the MPC may move to stem rising inflation, currently at 3.8 percent and well above the Government’s 2 percent target, by announcing a quarter-point rise to 5.25 percent.
Household budgets remain under pressure and last week, Centrica, which owns British Gas, shocked the country by announcing a 35 percent rise to gas bills, following double-digit price rises by EDF.
(Source: The Times)