The most recent set of Markit Buying Managers’ Index figures counsel that the dominant sector of the UK economic system, providers, is slowing down. The newest studying got here in at 50.1, on this scale something above 50 suggests development with a price lower than 50 indicating contraction.
While the January determine does nonetheless point out weak development, analysts had been anticipating a stronger efficiency of 51 which might mark a modest slowdown over the December studying of 51.2, so the slowdown is far more marked than anticipated.
Chris Williamson of HIS Markit blamed a mix of Brexit uncertainty with a basic slowing of the worldwide economic system for the figures:
“Development floor virtually to a halt in January, matching comparable disappointing information within the manufacturing and building sectors. The final three months have seen the economic system slip into its weakest development spell for six years and point out that GDP probably stagnated in the beginning of 2019 after eking out modest development of simply 0.1% within the fourth quarter. The survey outcomes point out that corporations have gotten more and more danger averse and keen to cut back overheads within the face of weakened buyer demand and rising political uncertainty. Such worries had been in flip mostly linked to heightened Brexit nervousness, although wider world political and financial components had been additionally seen to have been taking their toll on demand.”
The manufacturing PMI he referred to got here in at 52.8, once more, exhibiting an growth of the sector, however the second worst studying since July 2016.
Politicians in authorities make a lot of the truth that the economic system is “doing effectively” and increasing regardless of Brexit headwinds. Nonetheless, that is disingenuous for the reason that comparability must be made by way of the expansion of different main world economies. The UK’s charge of growth has fallen from the quickest rising within the G7 to the slowest because the Brexit drama has unfolded.