By Chris Dorrell
Economic activity returned to expansion in November as an improvement in the services sector helped lift the UK economy.
S&P Global’s Purchasing Managers’ Index (PMI) for the UK economy came in at 50.1, the highest level in four months and marginally above the 50 reading which indicates flat growth.
The PMI assesses the health of an economy’s services and manufacturing sector. Economists had expected a reading of 48.7.
The UK’s all-important services sector climbed to a five month high of 50.5 while the manufacturing sector, which has been stuck in contraction for months, rose to a six month high of 46.7.
“Survey respondents commented on a tentative revival in business services activity and resilient corporate spending,” the survey noted.
“The UK economy found its feet again in November as the service sector arrested a three-month sequence of decline and manufacturers began to report less severe cutbacks to production schedules,” Tim Moore, Economics Director at S&P Global Market Intelligence said.
“Relief at the pause in interest rate hikes and a clear slowdown in headline measures of inflation are helping to support business activity, although the latest survey data merely suggests broadly flat UK GDP in the final quarter of 2023,” he continued.
However, the survey point to “renewed signs of sticky inflation” as both input costs and prices charged increased at faster rates than in October.
More to follow
