U.K. Construction Posts Worst Decline in Five Years

U.K. construction output fell more steeply than previously estimated in the three months through September, driven by a drop in commercial work and housing repairs, new figures showed Friday.

The data from the Office for National Statistics show a second consecutive quarter of declining activity in the sector.

It suggests that uncertainty about post-Brexit trade arrangements is affecting companies' long-term investment decisions, while accelerating inflation is squeezing consumers, making them pare back non-essential spending.

The industry's output fell by 0.9% on the quarter in the July-September period, the largest quarterly decline in five years, the ONS said. The decline in the industry, which accounts for some 6% of the U.K. economy, was previously estimated at 0.7%.

Separately, new figures showed a widening of the U.K. trade deficit in goods in the third quarter, a sign that a hoped-for post-Brexit vote rebalancing of the economy away from consumption and toward trade has yet to materialize.

Britain imported GBP9.5 billion ($12.5 billion) in goods more than it sold to the rest of the world in the three-month period, the ONS said, a widening of GBP3.0 billion compared with the preceding quarter.

This was driven largely by an increase in the import of fuel, machinery and gold, government statisticians said.

Figures on the U.K. industrial production, also published Friday, were slightly more upbeat. Britain's industrial output grew by 1.1% in the three months through September, 0.1 percentage points faster than initially thought.

This was driven largely by strong growth in manufacturing, which contributed 0.8 percentage points to the headline figure, with production of cars and medical equipment growing robustly.

The new figures will have no impact on the preliminary estimate of overall economic growth of 0.4% in the third quarter, government statisticians said.

Write to Wiktor Szary at Wiktor.Szary@wsj.com

(END) Dow Jones Newswires

November 10, 2017 05:02 ET (10:02 GMT)