By Chris Dorrell
The UK economy is likely to continue growing at a reasonable rate in the second quarter, but at a slower pace than earlier in the year, a closely watched survey suggests.
S&P’s purchasing managers’ index (PMI), which measures activity in the private sector, came in at 52.4. This was down from 54.1 in April and below the 54 expected by economists. Anything above 50 indicates economic expansion.
The figures are consistent with the economy growing 0.3 per cent in the second quarter.
“The flash PMI survey data for May signalled a further expansion of UK business activity, suggesting the economy continues to recover from the mild recession seen late last year,” Chris Williamson, chief business economist at S&P Global Market Intelligence said.
Activity in the UK’s dominant services sector fell to its slowest rate in six months, with the PMI coming in at 52.9. This was down from 55.0 the month before.
However, the survey showed a significant improvement in manufacturing, with activity in the sector rising to a 22-month high of 51.3.
“New business volumes across the private sector rose for the sixth consecutive month in May. However, the rate of growth slowed to its weakest in the year-to-date and was relatively modest,” the survey said.
The economy is likely to be at the heart of the election campaign, with both parties putting growth at the centre of their pitch to voters.
The economy surprised pundits in the first quarter, growing 0.6 per cent. Rishi Sunak has argued the economy showed “gangbusters” growth as he seeks to close a 20 point gap on Labour ahead of the July vote.
More to follow
