UK Markit services PMI at 55.6, beats estimates

FXStreet (Mumbai) - The UK’s dominant service sector registered a further solid rate of expansion in January. UK Markit services PMI increased to 55.6 in January, higher than 55.5 reading seen previously. It also came in higher than estimated 55.3 reading.

Growth of total business activity was little-changed from December, and new business rose at the sharpest rate since last July.Service providers raised employment at the fastest pace since last October. That said, output growth was weaker than the trend rates achieved in 2013, 2014 and 2015. Moreover, the longer-term outlook for business activity hit a three-year low.

New business rose for the thirty-seventh consecutive month in January. The rate of expansion strengthened to a six-month high, and remained stronger than the average pace since the survey started in July 1996.

The rate of job creation picked up from December’s five-month low in January, and was strong overall. This contributed to an overall decline in outstanding business during the month,only the second contraction in nearly three years.