Data released by S&P Global/CIPS showed that activity growth in the UK private sector slowed again in October, reaching its lowest level since November 2023, reflecting slower rates of expansion in both the manufacturing and service sectors
The UK composite PMI fell to 51.8 points from 52.6 points in September. Economists had expected a drop to 51.7 points. Meanwhile, the services PMI declined to 52.0 points (the lowest value since November 2023) from 52.4 points in September. Consensus estimates suggested a decrease to 51.8 points. Both indices remain above the 50-point mark, which indicates an expansion of activity in the sector, for the 12th month in a row.
The report showed that new orders in the services sector rose again in October, with the latest increase being the slowest since June, but still slightly stronger than seen on average in the first half of 2024. Meanwhile, export orders recorded the strongest growth since March 2023. Service providers often noted stronger demand from EU clients, despite ongoing trade frictions due to Brexit. Employment growth in the service sector declined for the first time since December 2023, albeit slightly, reflecting the non-replacement of voluntary leavers amid budget constraints, efforts to boost productivity, and difficulties finding suitable candidates to fill vacancies. Overall input cost inflation edged up to a three-month high, but remained much softer than seen in the first half of 2024. Moreover, the rate of output price inflation picked up slightly from September's 43-month low. Meanwhile, business activity expectations for the year ahead decreased compared to September and reached a 4-month low.