Financial News: UK Service Sector Contracts In June

UK Service Sector Contracts In June

07/03/2026 - 08:48:00 (RTTNews)

(RTTNews) - The UK service sector contracted at the fastest pace since early 2023 in June, final purchasing managers' survey data from S&P Global showed Friday.

The services Purchasing Managers' Index posted 48.8 in June, down from 49.3 in May. The flash score was 48.7.

The score remained below the neutral 50.0 mark and hit the lowest since the start of 2023.

"June data confirmed a clear loss of momentum for the UK economy during the second quarter of 2026, following a positive start to the year," S&P Global Market Intelligence Economics Director Tim Moore said.

Service providers typically cited lacklustre domestic economic conditions, ongoing geopolitical uncertainties linked to the Middle East conflict and general risk aversion among clients. New orders fell for the fourth straight month. Export orders also continued its downward trend since March.

There was a sustained reduction in backlogs of work, reflecting a lack of pressure on business capacity.

Respondents cited an increase in their average cost burdens in June. Input price inflation slowed and output price inflation was the slowest since February.

Expectations among service providers improved slightly from May's 13-month low. However, confidence remained much less upbeat than the long-run survey average. The UK private sector output shrank moderately in June with the composite output index falling to the lowest since April 2025. The final composite output index hit 49.3, down from 49.7 in May and flash reading of 49.4.

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