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UK services sector slows to seven-month low as election looms

Published 03/07/2024, 10:10
Updated 03/07/2024, 10:40
© Reuters.  UK services sector slows to seven-month low as election looms

Proactive Investors - Britain's service sector saw its growth slow in June, a sign that both consumers and companies are remaining cautious ahead of the general election tomorrow.

S&P Global's UK services PMI slipped to 52.1 in June, down from 52.9 in May but importantly it was ahead of the 51.2 that the market had forecast.

It marks a seven-month low for the sector but remains ahead of the 50 mark, which separates the difference between growth and contraction.

The reading for the average PMI, which combines services output with the manufacturing sector, reached 52.3 last month, lifting from May's 53 and ahead of market guidance of 51.7.

"We are seeing some evidence of a pre-general election seize up across the UK services economy... as the prospect of a change in government led to the adoption of a ‘wait-and-see’ approach by some," said Joe Hayes at S&P Global.

"Nevertheless, we’re on track for another quarter of GDP growth, according to composite PMI data for the three months to June, albeit one that will be less punchy than the first quarter’s 0.7%.

"Prices still continue to show a high degree of stickiness across the UK service sector, although input cost inflation once again trended lower in June."

Read more on Proactive Investors UK

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