In December, the UK’s business landscape witnessed a mixed bag of economic indicators as revealed by the Purchasing Managers’ Index (PMI) figures.
The UK Services PMI managed to edge higher, reaching 51.4 in December, surpassing the market expectations which were set at 51.0. This indicates a relatively better performance in the services sector compared to what was anticipated.
However, the Manufacturing PMI told a different story. It continued its downward trend and fell further to 47.3 in December from 48.0 in November. Moreover, this figure missed the market consensus of 48.1, suggesting that the manufacturing sector is facing ongoing challenges and contraction.
Following the release of these UK business PMIs, the GBP/USD currency pair extended its gains and climbed above 1.2650.
Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, noted that “Businesses are reporting a triple whammy of gloomy news as 2024 comes to a close, with economic growth stalled, employment slumping and inflation back on the rise.” This statement highlights the complex and somewhat concerning situation that UK businesses are currently navigating as the year draws to an end.
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