- Prior 52.4
- Composite PMI 51.8 vs 51.7 prelim
- Prior 52.6
Services activity continues to see slowing momentum in October, with the weakest rise in business activity since November last year. Adding to that, employment conditions showed a fall for the first time this year. So, that is something that the BOE might want to take note of in terms of labour market developments moving forward. S&P Global notes that:
"October data signalled another slowdown in output growth across the service sector as heightened business uncertainty and concerns about the general UK economic outlook had an adverse impact on demand conditions.
"The latest expansion of service sector activity was the weakest since November 2023, while new business growth slipped to a four-month low. "The wait for clarity on government policy ahead of the Autumn Budget was widely reported to have weighed on business confidence and spending. Broader geopolitical concerns and forthcoming US elections also added to a sense of wait-and-see on business investment decisions in October. At the same time, cost of living pressures remained a constraint on household spending.
"With service providers grappling with softer new order growth and less upbeat business activity expectations for the year ahead, the latest survey pointed to a decline in staffing numbers for the first time since December 2023. A number of firms also noted budget constraints due to elevated salary pressures.
"Higher wages resulted in another month of strong input cost inflation across the service economy. The overall rate of inflation edged up to a three-month high, but remained much weaker than seen on average in the first half of 2024. Output charge inflation meanwhile held close to the 43-month low seen in September, with the latest reading consistent with a longer-term trend of decelerating price pressures across the service sector."
