UK Markit/CIPS June services PMI 5 July
- 53.8 prev
- composite 53.8 vs 53.9 exp vs 54.3 prev revised down from 54.4
- business expectations 63.7 vs 68.1 prev, weakest since July 2016
Also out:
- Q1 unit labour costs YY 2.1% as prev
- Q1 labour productivity as measured by output per hour -0.5% vs Q4 2016
- official reserves $491m vs $1115m prev
Gremlins behind the scenes again delaying my post. Apols.
Slightly softer than expected/prev data as I/markets anticipated. Still above the 50 positive reading threshold but weakest growth for 4 months
Markit says:
UK service providers indicated another slowdown in business activity growth during June, which largely reflected the weakest upturn in new work since September 2016. Survey respondents commented on subdued business and consumer confidence, alongside some instances of delayed decision making around the election.
Meanwhile, service sector firms were the least upbeat about their year-ahead growth prospects since July 2016. In contrast, there was a slight pickup in the pace of job creation to its fastest for 14 months in June.
Chris Williamson, Chief Business Economist at IHS Markit :
"A slowing in services sector growth completes a triple-whammy of disappointing PMI survey readings. Although the three PMI surveys are running at levels that are historically consistent with GDP growing by around 0.4% in the second quarter, it's clear that the economy heads into the third quarter losing momentum.
With business optimism having been hit by the intensification of political uncertainty following the general election and commencement of Brexit negotiations, at the same time that households are battling against rising inflation, the indications are that the economy's resilience is being tested. "There are pockets of growth, notably in financial services and business services, but the overall picture is one of business spending, investment and exports failing to provide sufficient impetus to fully offset the consumer slowdown.
"Given the deterioration in the forward-looking indicators, such as business optimism and order book growth, the risks are tilted towards the economy slowing in the third quarter."
All an anti-climax anyhow as GBPUSD tries to breach 1.2900 but holds. Currently 1.2905 with EURGBP also failing to hold above 0.8800.
Full Markit report here
