The engine of Britain’s economic growth slipped a gear in August after the services sector expanded at its slowest rate for two years.
In another sign that the UK economy is losing momentum, the Markit/Cips survey of the services sector, which generates more than three-quarters of Britain’s income, found a broad slackening in activity and a decline in the confidence of businesses in the outlook for the rest of the year.
Coming quickly on the heels of gloomy manufacturing figures, the latest health check of the services industry was worse than analysts had expected.
The Markit/Cips purchasing managers’ index (PMI) of services activity dropped to a 27-month low of 55.6 from 57.4 in July. Readings above 50 signal growth in activity compared with the previous month, and below 50 contraction.
The consultancy Capital Economics said the slowdown was likely to be a blip before momentum picked up again in the autumn as falling oil prices lifted household disposable incomes and eased price pressures on businesses.
But the fall in confidence was blamed by some analysts on the turmoil in world markets and the protracted slowdown in China, which has become a major export market for advertisers and other services firms. Without China as the motor for global trade, some economists fear the UK’s recovery will falter.
via The Guardian
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Latest posts by Alfonso Esparza (see all)
- Market Rally Still Going Low Holiday Volumes Awaiting Start of 2020 - 27 December 2019
- Market Awaits China Retaliation on Trade - 29 November 2019
- Alibaba to Close Order Book Ahead of Huge IPO - 18 November 2019