UK Service Sector Growth Improves On Strong Demand

(RTTNews) - The UK service sector's growth accelerated somewhat in July as demand increased at the fastest rate in more than a year, final survey data from S&P Global showed on Monday.

The S&P Global Services Purchasing Managers' Index rose to 52.5 in July from 52.1 in the previous month. The flash score was 52.4.

The reading remained above the threshold of 50.0 for the ninth straight month, and the growth was accelerated for the first time since April.

The growth in new orders was the strongest in fourteen months in July amid stronger demand conditions. Foreign demand was also favorable, as companies received greater new business from customers in Europe, North America, and Asia.

In line with growing demand, firms continued to raise their workforce numbers, and the latest rate of job creation was the strongest since June last year.

On the price front, price pressures remained elevated across the UK services economy, though the rates of inflation for input prices and output charges were among the softest seen in around three-and-a-half years. The overall cost inflation was attributed to higher expenses for transportation, IT, wages, and supplier fees.

British service providers expressed a positive outlook for business confidence in July, as the future activity index rebounded from June's recent low to a five-month high. The ending of the 2024 general election period was partially a factor, with greater certainty around domestic politics generating optimism, the survey said.

The composite output index rose to 52.8 in July from 52.3 in June, indicating a moderate and slightly faster expansion in private sector economic activity.