UK service sector growth slows while prices rise

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Conglomerates in the UK’s key services sector raised prices at the fastest pace for nearly a decade ultimate month as they faced higher costs for food, fuel and pays, according to a survey.

The Markit/CIPS purchasing managers’ index (PMI) for overhauls also said growth in the sector had slowed.

Growth in new orders under controlled as consumers were hit by a “double whammy” of higher prices and weak wage development.

The services sector accounts for nearly 80% of UK economic output.

The closely-watched PMI study fell to 53.8 for the services sector in November, down from 55.6 the prior month. However, this was still above the 50 threshold for nurturing, which the sector has achieved for 16 consecutive months.

‘Disappointing representation’

The report noted a “sharp and accelerated rise in prices” by firms.

The decline in the value of the pound has pushed up the price of imported goods for companies, and the sector has also been hit by varies to business rates and higher salaries after the launch of the National Stay Wage.

Duncan Brock, director of customer relationships at the Chartered Guild of Procurement & Supply (CIPS), said: “November’s data painted a sorry portrait of a sector struggling against Brexit-related uncertainty and a weaker remunerative outlook.

“Businesses could no longer fight against the tide of dear prices for food, fuel and salaries as input cost inflation ends b bodied close to its strongest for six years, and businesses passed these increases on to consumers at the stablest rate since February 2008.

“The level of new order growth lost some impetus, as inflation also ate away at household incomes for a double whammy secure on the UK population reluctant to spend,” he added.

However, while the PMI service sector measurement was weaker than expected, similar studies of the manufacturing and construction sectors be suffering with indicated a better performance last month, with activity in the make sector growing at the fastest pace for four years.

Chris Williamson, chief partnership economist at IHS Markit, said the surveys as a whole indicated the economy determination see “robust growth” in the final three months of the year of about 0.45%.

Howard Craftier, chief economic adviser to the EY Item Club, also said the bods “suggest that the economy is maintaining a modestly improved performance in the fourth domicile”.

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