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The UK’s private sector expanded for the fourth consecutive month and at the fastest pace since May last year, preliminary data suggested on Thursday.
The S&P Global flash composite purchasing managers’ index rose to a nine-month high of 53.3 points in February from 52.9 points in January. Rising further about the 50-point no-change mark, it shows the pace of expansion sped up slightly. The reading was higher than FXStreet-cited market consensus of 52.9.
The flash UK services PMI was unchanged from January, standing at 54.3 points. FXStreet were expecting a lower reading of 54.1.
‘Survey respondents often cited a turnaround in business and consumer spending, despite ongoing cost-of-living pressures, whilst some also commented on a boost from less restrictive financial conditions,’ S&P Global said.
Manufacturing remained in sub-50 contraction territory with a flash PMI of 47.1, though the reading was a three-month high, and above 47.0 the prior month. FXStreet, however, were expecting a higher reading of 47.5.
Looking ahead, S&P said that business expectations strengthened for the fourth consecutive month in February.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said: ‘UK economic growth has accelerated in February, with the early PMI survey data pointing to the largest rise in business activity for nine months. This is by no means a one-off improvement, as faster growth has now been recorded for four straight months after a brief spell of decline late last year.’
‘The survey data point to the economy growing at a quarterly rate of 0.2-3% in the first quarter of 2024, allaying fears that last year’s downturn will have spilled over into 2024 and suggesting that the UK’s ’recession’ is already over.’
The flash PMIs are compiled by S&P Global from responses to surveys sent out to around 650 manufacturers and 650 service providers in the UK. Responses are collected in the second half of the month.
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