Eurozone construction output falls in December

Eurozone construction output fell in December, mainly due to a sharp slump in Germany, according to data released on Monday by Eurostat.

Construction production declined 2.5% on the month following a revised 0.1% drop in November.

The figures showed that Germany suffered the biggest monthly fall in construction output, at 8%, followed by Austria at 7.6% and Poland at 3.8%.

Output in the eurozone's civil engineering sector decreased by 4% on the month in December, while building construction production was 2.3% lower.

On the year, construction output in the bloc was down 1.3% in December following a 1.6% decline the month before.

Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics, said: "The fall in output in December means that construction activity was unchanged quarter-on-quarter in Q4, improving after a 1.3% decline in the third quarter. In other words, construction was on track for a decent quarter in Q4 before it fell flat on its face in December.

"Looking ahead, the construction PMI rebounded in January, consistent with the PMIs for services and manufacturing, but the survey continues to signal overall falling out. Factoring-in tightening lending conditions, which should weigh on credit-sensitive construction, we think the sector will continue to languish at the start of the year. We look for a 0-to-0.5% quarter-on-quarter decline in Q1."