The newest 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 worth 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 way more marked than anticipated.
Chris Williamson of HIS Markit blamed a mix of Brexit uncertainty with a normal slowing of the worldwide economic system for the figures:
“Progress floor virtually to a halt in January, matching related disappointing information within the manufacturing and development sectors. The final three months have seen the economic system slip into its weakest development spell for six years and point out that GDP seemingly stagnated initially of 2019 after eking out modest development of simply 0.1% within the fourth quarter. The survey outcomes point out that firms have gotten more and more danger averse and keen to scale back overheads within the face of weakened buyer demand and rising political uncertainty. Such worries had been in flip mostly linked to heightened Brexit anxiousness, although wider international political and financial elements 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 properly” and increasing regardless of Brexit headwinds. Nonetheless, that is disingenuous because the comparability must be made when it comes to the expansion of different main international 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.