UK Services PMI rises to 62.9 in May
The United Kingdom’s services sector registered an increase in business activity in May, with the Purchasing Manager’s Index climbed for the third month in a row to stand at 62.9, the IHS Markit/CIPS report released on Thursday showed. This marks the fastest rate of output growth for 24 years.
Service providers noted a “sharp and accelerated” growth in new orders amid a significant rise in domestic demand. Exports were down slightly month-on-month. The backlog of work accumulated at the fastest pace since July 2014 amid reports of staff shortages. The increase in employment was strongest since March 2015. Spurred by added cost pressures and increased demand, survey participants reported the fastest rate of inflation since the survey began in 1996.
“UK service providers reported the strongest rise in activity for nearly a quarter-century during May as the roll back of pandemic restrictions unleashed pent up business and consumer spending,” Economics Director at IHS Tim Moore said. “The latest survey results set the scene for an eye-popping rate of UK GDP growth in the second quarter of 2021, led by the reopening of customer-facing parts of the economy after winter lockdowns,” he added.
Meanwhile, the UK’s Composite Output Index jumped to 62.9 in May from 60.7 in April.
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