UK Markit/CIPS August services PMI 5 Sept
- 47.4 prev
- composite 53.6 vs 50.8 vs 47.6 prev revised up from 47.5
- input prices rise at sharpest rate since Nov 2013
Largest jump on record for services PMI but it did start from a low base seen last month post-Brexit vote.
Better than expected data sees GBPUSD test 1.3360 and EURGBP down to 0.8370.
Currently back to 1.3345 but with EURGBP still looking soft.
Let's see what the second wave brings . Should remain underpinned for the moment.
Say Markit:
- The UK service sector returned to growth in August, according to PMI® survey data from IHS Markit and CIPS. Following abrupt contractions in output and new business in July linked to disruption related to the outcome of the EU referendum, the latest data signalled a return to growth as companies reported that uncertainty had abated somewhat.
- Moreover, the forward-looking business expectations index recovered most of the ground lost in July when confidence took a knock from the Brexit vote amid political and economic uncertainty, albeit remaining weak by historical standards. The latest data also signalled rising inflationary pressure linked to the weak pound.
- The survey's headline figure is the seasonally adjusted Markit/CIPS UK Services Business Activity Index, a single-figure measure designed to track changes in total UK services activity compared with one month previously.
"It remains too early to say whether August's upturn is a dead cat bounce or the start of a sustained post-shock recovery," IHS Markit economist Chris Williamson said. "But there's plenty of anecdotal evidence to indicate that the initial shock of the June vote has begun to dissipate."
Overall the figures suggested "an imminent recession will be avoided", Williamson added.
Full report here
