Business activity growth eased to a three-month low in September, according to a survey released on Thursday, but prices charged inflation slowed.
The S&P Global services purchasing managers’ index fell to 52.4 from 53.7 in August, coming in below the flash estimate of 52.8. Still, it remained above the 50.0 mark that separates contraction from expansion.
There was some more upbeat news on inflation, as the survey showed that prices charged inflation in the service sector – which acts as a barometer of domestic inflationary pressures – fell to the lowest in September since February 2021.
Tim Moore, economics director at S&P Global Market Intelligence, said: “The September PMI surveys suggest that the UK economy is still on a positive trajectory, with improving order books accompanied by cooling inflationary pressures.
“UK service providers indicated a moderate expansion of activity in September, fuelled by resilient business and consumer spending. However, the post-election rebound lost some momentum as output, new work and employment all increased at the slowest pace for three months.
“Robust domestic demand has been recorded throughout the third quarter of 2024, helping to offset a headwind from lacklustre export sales. Survey respondents linked rising volumes of total new work to renewed growth in the UK economy and the impact of domestic political stability on investment spending.”
Moore said some service sector firms commented on delayed decision-making among clients due to uncertainty ahead of the Budget on 30 October.
“However, the majority of survey respondents (56%) expect a rise in business activity during the year ahead, while only 11% forecast a downturn,” he said.