There was a modest increase in construction activity in February, according to Ulster Bank's monthly measure of activity in the sector.

It is believed adverse weather patterns, particularly storm activity, limited the pace of expansion.

The Construction Purchasing Managers' Index (PMI) registered at 50.6, down marginally from 50.9 recorded in January.

The scale goes from 1 to 100 with the break even point at 50. Any measure above 50 signals expansion in a sector.

The expansion in February was mainly accounted for by new business, as reduced Brexit uncertainty supported new orders.

Commercial activity led the way, but housing had a disappointing month with that category registering a second month in a row of declining activity.

The contraction was described as 'marginal' and activity would probably have expanded had the weather been better.

"There was a second consecutive month of contraction in housing, which was a little bit disappointing," Simon Barry, chief economist with Ulster Bank said.


"However, there was pretty bad weather in February with three storms over the course of the month and rainfall was higher than normal in places. The weather impact was captured in the results," Mr Barry said,

He said there were some very early signs of impact on the supply chain in the construction industry as a result of the coronavirus outbreak.

"We saw a lengthening in delivery times reported by some respondents. It was not a dramatic impact, but an early sign of a potential impact on construction," he explained.

Simon Barry said it was difficult at this stage to quantify an impact on the wider economy of the virus outbreak.

"We could be looking at scenarios where the impact is felt across the economy, across labour markets, across product markets, the production of goods and services.

"The virus, and the way it's going to potentially propagate through economies, is going to operate via supply. In other words, it's going to be difficult for firms and workers to what they do. It may hit demand, because there will be less money in the economy by virtue of the lower activity levels and higher levels of uncertainty.

"Many parts of the economy, including those which may not seem directly in the line of fire, are potentially going to be impacted," he concluded.