- Prior 49.5
- Manufacturing PMI 44.2 vs 43.0 expected
- Prior 43.0
- Composite PMI 46.8 vs 48.7 expected
- Prior 48.6
The BOE did mention that they had gotten a glimpse of the data here and with the services reading falling to a 32-month low, you can understand more on why they decided to pause yesterday. It's a big miss on estimates and the manufacturing slump is also still continuing with the reading still in contraction territory. S&P Global notes that:
“The disappointing PMI survey results for September mean a recession is looking increasingly likely in the UK. The steep fall in output signalled by the flash PMI data is consistent with GDP contracting at a quarterly rate of over 0.4%, with a broad-based downturn gathering momentum to hint at few hopes of any imminent improvement.
“Underscoring the severity of the UK's deteriorating situation, September's downturn is the steepest since the height of the global financial crisis in early 2009 barring only the pandemic lockdown months.
“The survey had warned that a revival of growth in the second quarter looked unsustainable, and the third quarter is indeed seeing a mounting toll on the economy from the reality of the increased cost of living and the recent rapid rise in interest rates.
“Despite higher fuel prices during the month, firms’ costs grew at a sharply reduced rate overall which, combined with collapsing pricing power amid weak demand, looks set to take further pressure off inflation in the coming months.
“A major concern in the inflation outlook has been wage growth, but with the survey now signalling the sharpest fall in employment since 2009, wage bargaining power is being eroded rapidly.
“With the Bank of England having had sight of the survey data prior to its latest policy decision, the worrying signals from the survey of heightened recession risk and cooling inflationary pressures are likely to have added to calls to halt rate hikes.”