December PCI is out showing housing construction is doing well.. Everything else, not so much with significant falls in engineering.
- The seasonally adjusted Australian Industry Group/Housing Industry Association Australian Performance of Construction Index (Australian PCI®) registered 50.8 in December 2013, indicating a third consecutive month of expansion for the national construction industry. However, the pace of growth moderated in response to more subdued expansions in new orders and activity. This loss of momentum in December was reflected in a slowdown in deliveries from suppliers and a renewed decline in employment.
- Although the Australian PCI® was above the critical 50 points level (that separates expansion from contraction), it was 4.4 points lower than the previous month, signalling a moderation in the industry’s rate of growth.
- Weighing on total industry activity in December was weaker engineering construction activity, which moved back into negative territory after two consecutive months of growth. House building remained the strongest performing sector. The pace of expansion in commercial construction and apartment construction activity moderated in the month, but both remained above 50 points.
- The selling prices sub-index moved above 50 points (to 54.9 points) for the first time since October 2010, providing further evidence of strengthening confidence in the sector.
- The slower pace of industry growth coincided with reports of fewer new contracts during the month and more project completions, most notably in the engineering construction sector. House builders reported that customer enquiries and buyer confidence had remained solid in December, despite some slowing in new orders. Tight credit conditions and a lack of public sector tenders were again cited by many as the main constraints on activity.