Activity at Irish construction firms fell only marginally during December and new orders rose. This suggests a stabilisation of the construction sector at the end of 2011, according to the Ulster Bank Construction Purchasing Managers’ Index – a key indicator of the health of the construction industry .

The index rose to 49.9 in December from 47.7 – signalling a negligible reduction in activity during the month. December’s reading was the highest since May 2007.

Ulster Bank chief economist Simon Barry said the index showed that the Irish construction sector “may be approaching a point of stabilisation”.