The UK’s service sector picked up marginally in September, expanding at a “modest pace” as Brexit concern continues to have an effect.
The Markit/CIPS purchasing managers’ index (PMI) figure for services, released on Wednesday, rose to 53.6 last month, up from an 11-month low of 53.2 in August. Any figure above 50 indicates growth.
Chris Williamson, chief business economist at IHS Markit, said “price pressures will pour further fuel” on expectations for the Bank of England to raise interest rates. However, since the economy is not “growing strongly”, the Monetary Policy Committee was likely to face a “difficult decision”.
The latest figures mean the UK is likely to meet its expectations of growing by 0.3 percent in the third quarter, despite a decline in construction and “robust” manufacturing.
“Service providers commented on subdued business-to-business sales and delayed decision making on large projects in response to Brexit-related uncertainty,” Markit said.
“The net balance of survey respondents anticipating a rise in business activity over the next 12 months was the lowest since June, meaning that business confidence remained close to its weakest since the end of 2011.”