Financial News: UK Private Sector Growth Improves In December

UK Private Sector Growth Improves In December

12/16/2025 - 07:53:00 (RTTNews)

(RTTNews) - The UK private sector activity expanded at a faster pace in December, led by the sharpest growth in new business in over a year, flash survey results from S&P Global revealed on Tuesday.

The composite output index rose more-than-expected to 52.1 in December from 51.2 in November. The expected level was 51.6. A reading above 50.0 indicates expansion in the private sector.

Faster rises in business activity were seen in both the manufacturing and service sectors, the survey said.

The services PMI hit a 2-month high of 52.1, up from 51.3 in the previous month. The score was forecast to drop to 51.9.

Meanwhile, the flash factory PMI climbed to a 15-month high of 51.2 in December from 50.2 in the previous month.

There was a renewed rise in new orders, which grew at the strongest rate in fourteen months, mainly reflecting a solid improvement in demand across the service economy. New export orders also rose for the first time in fourteen months.

Backlogs of work increased marginally due to a combination of worsening supplier performance and higher-than-expected demand. Nonetheless, employment continued to decline notably, linked to intense cost pressures along with the impact of elevated business uncertainty.

On the price front, input price inflation accelerated to a 7-month high, led by strong wage inflation, higher fuel bills, and rising technology costs. As a result, selling price inflation rebounded from the five-year low seen in November.

"The sluggish growth and worrying jobs data from the flash PMI data therefore suggest that the odds remain in favor of a further cut to interest rates at the December MPC meeting, but that the path to further rate cuts in 2026 remains very data dependent, as policymakers await confirmation that price pressures are going to soften materially as the year proceeds," Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said.

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