LONDON — Britain's construction industry showed encouraging signs of recovery in July after months of weakness, with the latest S&P Global UK Construction Purchasing Managers' Index (PMI) indicating that the pace of decline slowed considerably.

The PMI improved to 44.7 in July from 38.4 in June. Although the reading remains below the 50-point mark that separates growth from contraction, economists said the figures point to a stabilising sector following a difficult second quarter.

Commercial construction and housebuilding both recorded smaller declines, while firms reported improving expectations for future workloads. Confidence among builders climbed to its highest level since before geopolitical tensions earlier this year, supported by hopes of stronger infrastructure spending and new project tenders.

Construction companies also noted that easing inflationary pressures and expectations of increased public investment were helping improve sentiment. However, businesses continued to highlight challenges including cautious client spending, higher financing costs and labour shortages.

Industry experts believe the latest survey signals that Britain's construction sector may be approaching a turning point. If demand continues to recover over the coming months, the industry could provide an important boost to economic growth, employment and investment across the UK.