The services sector activity in the UK economy saw a solid upturn in the month of August, beating the consensus forecast by a big margin, a fresh report from Markit Economics showed on Wednesday.
The services PMI jumped to 54.3 in August versus a 53.5 reading booked in July. Markets predicted 53.9 last month.
Key Points:
Stronger rises in business activity and new work.
Input cost inflation accelerates, led by fuel prices and wage pressures.
Optimism towards the year-ahead business outlook at the lowest level since March.
Chris Williamson, Chief Business Economist at IHS Markit, which compiles the survey:
“Faster service sector growth comes as much-needed welcome news after disappointing manufacturing and construction PMI surveys in August. The survey data indicate that the economy is on course to expand by 0.4% in the third quarter, a relatively robust and resilient rate of expansion that will no doubt draw some sighs of relief at the Bank of England after the rate hike earlier in the month.”
“Faster service sector order book and employment growth also offset slowdowns of both in the manufacturing and construction sectors, but also highlights the extent to which the economy has become more reliant on services to support growth, and in particular an especially strong financial service sector. Financial services have outperformed all other sectors so far this year.”
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