LONDON, May 3 (Reuters) – Service sector activity in Britain recorded its strongest growth in almost a year in April, despite a renewed surge in inflationary pressures, survey results showed on Friday from S&P Global/CIPS UK purchasing directors.
The services PMI accelerated to 55.0 in April, its highest level since May 2023. It stood at 52.8 in March and a first estimate in April at 54.9.
The 50 mark separates growth and contraction in activity.
The survey also shows a sharp rise in new orders, alongside the sharpest acceleration in cost pressures since August.
The Bank of England (BoE), which meets next week, will probably have to take this new development into account.
The acceleration of inflationary pressures is linked, according to many companies, to the 10% increase in the national minimum wage in April. Other companies also note that rising labor costs are one reason employment growth has slowed to its lowest level since the start of the year.
“The latest survey results reflect growth in the UK economy at a quarterly rate of 0.4%, putting it further away from the slight recession recorded last year,” comments Tim Moore, Economic Director at S&P Global Market Intelligence.
The good performance of services contrasts with the monthly manufacturing PMI index, published on May 1, which fell below the 50 mark in April after briefly passing into positive territory in March.
Overall, the composite PMI, which combines the service and manufacturing sectors, rose in April to 54.1 from 52.8 in March, a one-year high. (Written by Andy Bruce; French version Claude Chendjou, edited by Blandine Hénault)
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