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Business activity in the UK’s service sector edged into growth territory in November, helping stabilise the country’s economy, according to preliminary survey data on Tuesday.
The S&P Global/CIPS flash UK flash composite purchasing managers’ index rose to 50.1 points in November, from 48.7 in October.
This marked a four-month-high and represents growth, edging above the no-change 50.0 mark.
The flash services PMI business activity index jumped to a four month high, registering 50.05 in November from 49.5 in October.
Meanwhile, the flash manufacturing PMI rose to 47.9 from 44.3. Whilst this marks a five-month-high, it also signifies the ninth consecutive month of contractions in the sector.
On the inflation front, overall cost pressures across the private sector economy remained much softer than seen in the third quarter of 2023, S&P said. However, the rate of input price inflation accelerated slightly from October’s 33-month low.
Looking ahead, S&P noted that the the latest survey pointed to resilient business activity expectations for the year ahead. The degree of optimism picked up from October’s ten-month low, thanks to rising confidence in the service sector.
Tim Moore, economics director at S&P, commented: ‘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. 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.’
The flash PMIs are compiled by S&P Global from responses to surveys sent out to around 650 manufacturers and 650 service providers in the UK. Responses are collected in the second half of the month.
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