The UK services sector accelerated in November to its fastest pace in 10 months, which means that the economy is about to keep the pace of expansion this quarter. The purchasing Manager’s Index rose to 55.2 points in November from 54.5 points in October, above the median forecast of economists was for level of 54 points.
The overall index, which includes construction and manufacturing, also reached 10-month high, which means that economic growth could reach 0.5% in the three months to the end of December.
Although the economy is expanding at a steady pace, the confidence among the service companies fell to its lowest level since July. The respondents linked darker moods with political uncertainty about the British decision to leave the European Union, as well as growing inflationary pressures. The pressure that strikes and producers as a result of the decline of the pound for votes for Brexit in June.
The chief economist of the Bank of England, Andy Haldane noted on Friday, that the change in the growth and decline of inflation has a neutral position on the next decision on interest rates as central bankers cut them in August.
Haldane, who prefers to loosen the monetary policy, said that there are reasons not to rush with rising interest rates.
Chances Bank of England to increase stimulus will continue to become smaller and smaller. Any policy tightening still looks too far given the uncertainty over the UK economy.
The index for construction rose to an 8-month high of 52.8 points in November, while the index of production fell to 4-month low of 53.4 points.
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