U.K. construction PMI loses momentum in March, adds to signs of slowdown

U.K. construction PMI missed expectations in March, continued to ease, dampening optimism over the British economy. The Markit/CIPS Construction Purchasing Managers' Index (PMI) dropped back to 52.2 from 52.5 in February, missing median forecast of 52.4 in a Reuters poll.

The report indicated that the housing slowdown offset the rebound in civil engineering and commercial work, while input price inflation also slowed further from January’s peak. The slight slowdown in Britain's construction industry in March added to signs that the economy has lost some of its strong momentum.

“U.K. construction firms experienced a growth slowdown in March, with the loss of momentum centered on housebuilding,” Markit senior economist Tim Moore commented in the report.

“A weaker trend for residential work has been reported throughout 2017 so far, which provides an indication that the cooling U.K. housing market has started to act as a drag on the construction sector,” he added.

GBP/USD was 0.32 percent lower on the day. The pair was holding crucial 100-DMA support at 1.2419. A break below will see downside in the pair. We find technical studies on daily charts supporting downside and advise a short on break below 100-DMA, targets 1.2155 (trendline).