UK Economy Surpasses Expectations with Strong August PMI
Service sector growth hits six-month high as manufacturing activity cools slightly, defying earlier predictions.
Image: Eddie Pollard / AI
Callum Smith
The S&P Global flash UK composite purchasing managers’ index reached 52.5 in August.
The service sector experienced a notable uplift in August, with growth reaching a six-month high of 52.8.
This figure exceeded all forecasts in a Reuters poll that had pointed to a fall to 51.8.
Conversely, activity in the manufacturing sector saw a slight dip, registering a reading of 51.5 for August.
Chris Williamson noted, "The UK economy picked up a bit more pace in August, adding to signs that we should see solid economic growth of around 0.3% in the third quarter."
The expansion is being helped by sunny weather and tech investment, though as expected we have seen some softening of growth in the manufacturing sector as precautionary stock building cools.
Williamson further explained that "The expansion is being helped by sunny weather and tech investment, though as expected we have seen some softening of growth in the manufacturing sector as precautionary stock building cools."
Surveyed companies reported a "steady upturn" in client confidence and improving domestic economic conditions.
This upturn is understood to follow the appointment of Andy Burnham as Prime Minister last month.
Companies also highlighted challenges, particularly citing higher fuel prices and efforts by suppliers to pass on increased transport costs.
Williamson added that the current economic climate "reflects easing concerns, for now, over the economic impact of the war in the Middle East."