Supply and demand shocks driven by policy rather than normal market forces have provided a breeding ground for a split sector-specific recovery in 2021 and beyond. With the prospect of broad inflationary pressures on the horizon, will construction tender prices follow suit?
A few significant changes since our previous (Q1 2021) TPI forecast have given rise to some upwardly revised inflationary predictions. COVID-19 has made it difficult to quantify the precise impact of Brexit on trade but the implementation of the EU-UK Trade and Cooperation Agreement has certainly increased non-tariff barriers on UK-EU trade, pushing up prices for European goods and services. Also since our last report the UK’s comparatively successful vaccine programme has exceeded expectations. The speedy rollout has thus far enabled the UK to stick to its roadmap of easing lockdown restrictions, fostering a faster economic revival and outlook. With this, we expect that confidence and investment activity will continue to build and increase the number of tendering opportunities in a number of key sub-sectors.