The UK manufacturing sector reversed a steep run of three months of declines in its purchasing managers’ index to be unchanged in January, as business confidence improved due to an apparent weakening of economic uncertainties.

The construction PMI rose to 54.5 in January, beating economist forecasts and remaining above the crucial 50 level that separates expansion from contraction.

The UK manufacturing PMI was unchanged at 50.6 in January, according to Markit Economics. However, the reading from the closely-watched index has now held above the 50 point level for five consecutive months.

The survey of around 400 manufacturers also revealed that new orders rose, with output gaining at its fastest rate in over two years. The survey’s sub-indexes for employment and export orders were both higher in January than at any time since May 2016.

Amid a housing market that is still still healing from the sector’s collapse in the wake of the 2008 financial crisis, a new poll of mortgage brokers found that only 12 per cent of potential buyers expect house prices to rise at a pace above inflation over the next year, down from 17 per cent in October.