Financial News: UK Service Sector Growth Weakest Since Early 2021

UK Service Sector Growth Weakest Since Early 2021

08/03/2022 - 09:21:00 (RTTNews)

(RTTNews) - The UK service sector expanded at the slowest pace since the national lockdown in February 2021 in the face of heightened economic uncertainty, final data from S&P Global showed on Wednesday.

The final services Purchasing Managers' Index fell to 52.6 in July from 54.3 in the previous month. The flash score was 53.3.

The indicator signaled the slowest pace of growth in the current sequence of expansion and pointed to a noticeable loss of momentum.

New business growth weakened in July as rising economic uncertainty and high inflation constrained client budgets. Backlogs of work increased fractionally since June, which was due to another notable expansion in staffing levels.

Operating expenses of companies continued to climb at a historically elevated rate in July. Nonetheless, the rate eased from the record levels seen in May and June. Firms increased their own charges but at the lowest pace in five months.

Finally, confidence in the outlook remained relatively subdued. Worries persist over the impact of high inflation, rising interest rates and recession risks for the UK and global economy. Overall business optimism picked up slightly since June. The overall private sector has continued to expand for the seventeenth consecutive month. However, the reading was the lowest since February 2021.

The Chartered Institute of Procurement & Supply final composite output index fell to 52.1 in July from 53.7 in June. The score was below the flash 52.8.

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