UK Service Sector Growth At 10-Month High

RTTNews | 56 hari yang lalu

(RTTNews) - The UK service sector posted its fastest growth in ten months in June underpinned by a renewed improvement in order books, final purchasing managers' survey results from S&P Global showed on Thursday.

The services business activity index climbed to 52.8 in June from 50.9 in the previous month. This was the highest score since August 2024 and also above the initial estimate of 51.3.

The survey revealed that combined output of manufacturing and service sectors registered its fastest growth since September 2024. The composite output index improved to 52.0 from 50.3 a month ago. The flash score was 50.7.

The rebound in the services sector was fueled by a turnaround in domestic business and consumer spending.

However, some services companies commented on growth headwinds from subdued UK economic conditions, the impact of US tariffs and adverse geopolitical factors.

New orders received by service providers were the strongest since November 2024. There was greater demand in domestic markets, while export sales declined for the third straight month.

Employment decreased for the ninth consecutive month in June. The rate of job shedding was slightly faster than in May.

Backlogs of work decreased in each month since June 2023, marking the longest continuous period for more than 15 years.

Service providers remained optimistic about their prospects for business activity growth over the next twelve months.

The survey showed that cost inflation in the service sector eased to its lowest in six months. Due to weaker cost inflation and intense competition for new work, charged inflation showed another slowdown.

S&P Global Market Intelligence Economics Director Tim Moore said that a combination of easing price pressures and lower employment leaves the door open for the Bank of England to resume its run of interest rate cuts at the next policy meeting in August.

The BoE had reduced its interest rates four times since last August. Last month, the bank maintained status quo as inflation remained persistently above the 2 percent target.

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