LONDON, Oct 5 (Reuters) – British companies final month suffered the sharpest contraction in exercise since early final yr, though the downturn was rather less extreme than first estimated, a survey confirmed on Wednesday.
The ultimate model of the S&P International UK Composite Buying Managers’ Index fell to 49.1 in September from 49.6 in August, the bottom studying since January 2021 when a lot of the nation was nonetheless in a COVID-19 lockdown.
Any studying beneath 50 means a contraction in exercise.
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Whereas the studying was an enchancment on a preliminary “flash” studying of 48.4, companies firms that comprise the majority of the private-sector economic system had been the least constructive in regards to the outlook since Might 2020, early within the pandemic.
General the survey chimed with different indicators that counsel Britain’s economic system is flirting with recession.
“Service sector companies trimmed their development expectations to the bottom seen for almost two-and-a-half years in September, which survey respondents linked to considerations about falling disposable revenue and the unfavourable world financial outlook,” mentioned Tim Moore, economics director at S&P International Market Intelligence.
The PMI for the companies sector fell to 50.0 from 50.9 in August, signifying stagnation however nonetheless higher than the flash studying of 49.2.
New orders from each residence and overseas declined in September, with survey respondents blaming Brexit and a weaker world economic system, in addition to subdued confidence and clients reducing prices.
Inflation stress remained near the file excessive recorded in Might, as companies reported “unavoidable” value will increase attributable to larger payments for wages, power and provides.
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Reporting by Andy Bruce; Modifying by Susan Fenton
Our Requirements: The Thomson Reuters Trust Principles.
