According to the report from HCOB, activity in the construction sector continued to contract in April, while the pace of contract accelerated compared to the previous months.
The eurozone construction PMI fell to 41.9 points from 42.4 points in March. The index remains below 50 points, which indicates a reduction in activity in the sector, for the 24th month in a row. The overall reduction in activity reflected declines across the three largest eurozone economies in April. Activity in Italy decreased for the first time in seven months, joining Germany and France in contraction mode. That said, the modest fall in Italy was still much softer than those seen elsewhere.
The HCOB said that all three broad areas of the construction sector recorded a reduction in activity, with the housing sector being the worst performing sub-sector for the 20th consecutive month, but the rate of reduction was almost unchanged compared to March. A sharp and accelerated fall in commercial activity was registered, while the slowest decline was in civil engineering, where the decrease was marked nonetheless. New orders in the construction sector fell again in April (for the 25th month in a row), while the rate of decline slowed compared to March. The labor force also declined last month, albeit modestly and to a slightly lesser extent than in March. As for the inflationary situation, the pace of input cost inflation eased to a seven-month low. The data also showed that construction companies in the euro area remained pessimistic regarding the year-ahead outlook for activity.