Building powers a bounce

The economy is on track for a bounceback in the current quarter after the building industry's strongest growth for almost a year in February.

The latest Chartered Institute of Purchasing & Supply/Markit activity index, where a score over 50 signals growth, hit an 11-month high of 54.3 last month, led by a revival in commercial building.

Construction firms surprisingly escaped the impact of the oil price hikes which hit manufacturers in February, although the industry is still shedding jobs.

Markit's Sarah Bingham said: "The sharp increase in new business received should keep firms busy in the coming months."

The economy shrank 0.2 per cent in the final three months of 2011, but the momentum in the building industry should contribute to overall growth, according to Howard Archer at IHS Global Insight.