UK business activity suffers biggest contraction since early 2021
British businesses suffered the biggest contraction in business since the start of last year last month, although the downturn was somewhat less severe than expected, according to a survey released on Wednesday.
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The final version of the S&P Global UK Composite Purchasing Managers’ Index fell to 49.1 in September from 49.6 in August, the lowest reading since January 2021, when much of the country was still in lockdown by COVID-19.
Any reading below 50 signifies a contraction in activity.
While the reading was an improvement from a preliminary “flash” reading of 48.4, service companies that make up the bulk of the private sector economy were the least positive about the outlook since May 2020, when it started. of the pandemic.
Overall, the survey rang with other indicators that suggest the UK economy is flirting with recession.
“Companies in the services sector slashed their growth expectations to the lowest in nearly two and a half years in September, which survey respondents linked to concerns about falling disposable income and an unfavorable global economic outlook. said Tim Moore, chief economics officer at S&P Global Market Intelligence.
The PMI for the services sector fell to 50.0 from 50.9 in August, signifying flat but still better than the flash reading of 49.2.
New orders from home and abroad fell in September, with survey respondents blaming Brexit and a weaker global economy, as well as subdued confidence and customers cutting costs.
Inflationary pressure remained near May’s record high as businesses reported “inevitable” price hikes due to higher bills for wages, energy and supplies.
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