- Prior 51.5
- Composite PMI 48.6 vs 47.9 prelim
- Prior 50.8
This marks the first fall in UK business activity since January, with the slightly better revisions helping to not paint a worse picture of the UK economic backdrop - for now at least. S&P Global notes that:
"Service providers saw customer spending reverse course during August as higher borrowing costs, subdued business confidence, and stretched household finances all acted to curtail sales opportunities.
"After a modest recovery over the past six months, service sector businesses are now clearly feeling the impact of rising interest rates on client demand. Worries about the broader business climate also dampened spending in August, with firms suggesting that faltering UK economic growth and sticky inflation were weighing on the outlook.
"Adding to signs of reduced pressure on business capacity, the latest survey indicated that backlogs of work decreased at the fastest pace for over three years. Service providers appear to have gently put the brake on staff hiring, with job creation easing to its lowest since March.
"Key data to watch in the coming months will be the extent to which weaker employment trends and softer demand translate into falling domestic inflation. August's survey data provided a signal that heightened competitive pressures have helped to push down output charge inflation across the service economy, as the latest round of price hikes was the slowest seen for two years."
