- Services PMI 52.8 vs 53.5 expected and 53.7 prior.
- Manufacturing PMI 51.5 vs 52.5 expected and 52.5 prior.
- Composite PMI 52.9 vs 53.5 expected and 53.8 prior.
Key Findings:
- Flash UK PMI Composite Output Index(1) at 52.9 (Aug: 53.8). 2-month low.
- Flash UK Services PMI Business Activity Index(2) at 52.8 (Aug: 53.7). 2-month low.
- Flash UK Manufacturing Output Index(3) at 53.5 (Aug: 54.4). 3-month low.
- Flash UK Manufacturing PMI(4) at 51.5 (Aug: 52.5). 3-month low.
Comment:
Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said:
“The September PMI data bring encouraging news, with robust economic growth being accompanied by a cooling of inflationary pressures. The data therefore hint at a ‘soft landing’ for the UK economy, whereby the fight against inflation is showing increasing signs of being won without higher interest rates having caused a downturn."
“A slight cooling of output growth across manufacturing and services in September should not be seen as too concerning, as the survey data are still consistent with the economy growing at a rate approaching 0.3% in the third quarter, which is in line with the Bank of England’s forecast."
“Business optimism has also risen, albeit with concerns about the impact of the Autumn Statement jangling nerves somewhat, notably in the manufacturing sector. Investment plans in particular are reported to have been put on ice pending clarity on the new government’s policies, especially towards taxation. Hiring likewise has been stifled by business uncertainty about the near-term economic outlook ahead of the ‘budget’."
“In the meantime, services inflation, stubbornly elevated rates of which have been the bugbear of the Bank of England, cooled in September to the lowest since February 2021 to help bring the Bank of England’s 2% inflation target closer into view. The survey data therefore support the view that there is scope for interest rates to fall further in the closing months of 2024.”
