020 7898 0500The big economic news from the UK yesterday was that Markit’s service sector PMI came in above expectations and provided some cause for optimism following disappointing construction data earlier in the week. Although the increase is marginal, it does still represent an acceleration and should do much to allay fears.
However, it is worth noting that on the back of those figures came the news that service sector bosses warned that new orders rose at their slowest rate for 13 months. Perhaps the Brexit dust hasn’t quite yet settled. Indeed, the all-sector PMI (which measures growth across the entire UK economy), hit its lowest level since Brexit.
Meanwhile, Standard & Poor’s published a new report that claimed the Bank of England had purposely been talking up a UK interest rate rise to prevent the pound from sliding. They said that Britain’s economy wasn’t yet strong enough to justify a hike and, while one might be forthcoming in November, further rates were unjustifiable.
Having said all of this, sterling still made gains against the euro and US dollar. The truth is that the service sector PMI carries more weight in the City; the fact it actually came in above forecast is a real positive, especially in the context of other data recent released.
