- UK Services PMI 55.0 vs. 54.9 expected and 53.1 prior.
- UK Composite PMI 54.1 vs. 54.0 expected and 52.8 prior.
Key findings:
- Activity and new work rise at fastest rates for 11
months. - Staff hiring remains subdued.
- Input cost inflation highest since August 2023.
Comment:
Tim Moore, Economics Director at S&P Global Market
Intelligence, which compiles the survey: “Service providers benefited from improving business and
consumer spending in April as more favourable demand
conditions underpinned the greatest improvement in activity
since May 2023. The latest survey results are consistent
with the UK economy growing at a quarterly rate of 0.4% and
therefore pulling further out of last year’s shallow recession.
“Relief at a turnaround in the economic outlook was commonly
cited as a factor supporting sales pipelines in April. However,
there were also reports that clients remained somewhat risk
averse and under pressure from elevated inflation. These
undercurrents constrained margins and meant that some
service sector companies were cautious about taking on more
staff. The overall rate of job creation was only marginal in April
and slipped to its weakest so far in 2024.
“Prices charged inflation across the service sector eased to
a three-year low in April, suggesting that the pass-though of
higher costs has started to wane. This was despite a sharp
and accelerated rise in business expenses as strong wage
inflation pushed up operating costs.
“Business activity expectations for the year ahead were
upbeat overall in April, therefore adding to signs that the
recovery in service sector performance has further to run.
Election uncertainty and fading prospects for interest rate
cuts were cited as headwinds on the horizon, but survey
respondents still mostly reported positive sentiment towards
their business investment plans and longer-term growth
opportunities.”
UK Services PMI