Britain's construction sector grew faster than expected last month, notching a rate of expansion that almost matched February's eight-month high.
The headline activity index of the Markit/CIPS survey of purchasing managers came in at 56.4 in March after hitting 56.5 in February. Analysts had forecast a steeper fall to 54.9.
Construction makes up only 6% of British economic output, but has recently had a strong correlation with overall GDP growth.
Evidence that the sector was continuing to growth strongly reassured investors after a disappointing manufacturing survey on Friday. However, there were signs of accelerating price pressures with the rate of cost inflation hitting its highest in 31 months.
The price of fuel, oil and steel were the biggest culprits. Sentiment, while strong in historic terms, weakened for a second consecutive month, with firms citing looming government spending cuts.
UK mortgage holders paying off debt
Separate Bank of England figures showed that UK mortgages were paid down at a record rate in the final quarter of last year, as homeowners moved to improve their personal balance sheets.
Borrowers reduced their outstanding mortgage debt by £7 billion during the three months to the end of December, the Bank of England said.
It was the 11th consecutive quarter during which the amount of money people unlocked from their homes was negative and the highest net injection of housing equity since records began in 1970.
The recent trend among homeowners to pay down their mortgages contrasts with their behaviour during the housing boom.
