UK business activity picks up at fastest pace since April

4th Sep 2024 10:48

(Sharecast News) - Business activity in the UK picked up in August at its fastest pace since April, according to a survey released on Wednesday.

The S&P Global purchasing managers' index composite output index rose to 53.8 from 52.8 in July.

Meanwhile, the services PMI business activity index came in at 53.7 in August, up from 52.5 the month before and above the neutral 50.0 mark that separates contraction from expansion for the tenth consecutive month.

Tim Moore, economics director at S&P Global Market Intelligence, said: "August data highlighted a recovery in UK service sector performance as improving economic conditions and domestic political stability helped to bolster customer demand. New business again increased at a robust pace after a lull in decision-making earlier this summer. This fuelled the fastest upturn in service sector activity since April and extended the current period of growth to ten months.

"Service providers responded to the upturn in business conditions by hiring additional staff in August. Job creation remained faster than seen on average in the first half of 2024, despite headwinds from scarce candidate availability and elevated wage pressures.

"Higher salary payments resulted in another sharp rise in cost burdens across the service economy. However, the overall rate of input price inflation resumed its recent descent in August and reached its lowest since January 2021. Adding to meaningful signs of softer inflationary pressures in the service sector, the latest survey indicated that average prices charged increased at the weakest pace for three-and-a-half years."