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UK November flash services PMI 58.6 vs 58.5 expected


Latest data published by Markit / CIPS – 23 November 2021

  • Before 59.1
  • Manufacturing PMI 58.2 vs 57.3 expected
  • Before 57.8
  • Composite PMI 57.7
  • Before 57.8

A slight decline in the services sector outweighs a slight increase in manufacturing output, bringing overall trade activity in the UK to its lowest level in two months.

However, the most remarkable detail of the report is that the last increase in the average cost burden was the fastest since the start of this index in January 1998.

It should be noted that around 63% of UK private sector companies reported an increase in their average finance charges in November, while only 1% reported a decrease. Markit notes that:

“The combination of sustained business growth, further gains in the labor market and record inflationary pressures gives the green light for an interest rate hike in December.

“Production growth in industry and services was slightly faster than expected in November, although heavily skewed in favor of the service sector, with factories continuing to struggle with supply shortages and declining exports .

Encouragingly, an acceleration in new business growth suggests that December should end the year strong, meaning the fourth quarter should see a welcome pickup in GDP growth after the slowdown seen in the third quarter.

“For policymakers concerned about the health of the labor market after the end of the leave scheme, the reported sustained employment growth should provide some reassuring comfort.

“A record rise in business costs will further fuel fears that inflation will soon surpass 5%, with near-record supply delays persisting adding to indications that price pressures may show little sign of abating in the near future. short term.

“The relatively poor performance of manufacturing will likely remain a concern for some time, as will the potential to see stricter COVID-19 growth-inhibiting restrictions enforced amid a high number of COVID-19 cases at a time. at home and now also in continental Europe The latest survey results will nonetheless likely reduce the chances of an interest rate hike at the Bank of England’s December meeting. “


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