Investing.com - U.K. service sector activity expanded at a slower rate than expected in July, dampening optimism over the health of the economy, industry data showed on Wednesday.
In a report, market research group Markit said the seasonally adjusted Markit/CIPS Services Purchasing Managers Index declined to 57.4 last month from a reading of 58.5 in June. Analysts had expected the index to fall to 58.0 in July.
On the index, a level above 50.0 indicates expansion in the industry, below 50.0 indicates contraction.
Despite easing slightly since June, growth of business activity remained sharp and was in line with the trend pace over the past two-and-a-half years of continuous expansion.
New business rose at a faster rate, and growth of outstanding business resumed following June’s decline.
Commenting on the report, Chris Williamson, Chief Economist at survey compilers Markit said, “The survey data point to GDP growth merely easing from 0.7% in the second quarter to a still-impressive 0.6% at the start of the third quarter, which will do little to deter hawks at the Bank of England from voting for higher interest rates."
GBP/USD was trading at 1.5584 from around 1.5587 ahead of the release of the data, while EUR/GBP was at 0.6969 from 0.6972 earlier.
Meanwhile, European stock markets remained higher. London’s FTSE 100 rose 0.2%, the EURO STOXX 50 tacked on 0.75%, France's CAC 40 advanced 0.8%, while Germany's DAX climbed 0.95%.