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The UK private sector remained in growth in March, thanks to a strong performance by service providers, survey results from S&P Global showed on Friday.
The headline seasonally adjusted S&P Global flash composite purchasing managers’ output index registered 52.2 points in March, down from February’s eight-month high of 53.1.
Though the reading dropped in March, it remained above the 50.0 no-change mark that separates growth from contraction. The composite PMI combines the services and manufacturing sectors.
Market consensus had expected the composite PMI to dip to 52.8, according to FXStreet.
‘With the flash PMI surveys signalling a second month of rising output in March, the UK economy looks to have returned to growth in the first quarter. The surveys are broadly consistent [gross domestic product] growing at only a modest quarterly rate of 0.2%, but this represents a welcome expansion compared to the lack of growth seen in the second half of last year,’ said Chris Williamson, chief business economist at S&P Global Market Intelligence.
S&P Global said UK private sector firms that responded to the survey reported a solid rise in new business volumes in March, with higher levels of new work recorded in each of the past two months. The latest upturn was the fastest since April and reflect a ‘robust and accelerated rise’ in new business across the service economy, it added.
The flash services PMI fell to 52.8 points in March from 53.5 in February. Meanwhile, the flash manufacturing PMI declined to 48.0 from 49.3, showing the rate of contraction in the factory sector worsened in March.
Looking forward, UK private sector firms are optimistic about their business activity prospects during the next 12 months, S&P Global said, with the degree of confidence the highest since March 2022.
‘This largely reflected a rise in business expectations across the manufacturing sector, which has driven by hopes of a rebound in customer demand and a boost from improving supply chain performance. Confidence across the service economy was unchanged since February, despite recent volatility across global financial markets,’ S&P Global explained.
The composite PMI is complied by S&P Global from responses to questionaries sent to around 650 manufacturers and 650 services providers in the UK. The data was collected between March 10 and 22.
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