UK services sector grows faster-than-expected in September

UK services sector grows faster than expected in September, which raise doubts whether it needs another reduction in interest rates by the Bank of England. Purchase Managers Index (PMI) slowed from 52.9 points in August to 52.6 points in September, but the sector remains an area of expansion as the cost of the meter is more than 50 points. In August it recorded the sharpest one-month rise in 20-year history of the survey.

The studies in the field of manufacturing and construction in the UK, published earlier this week also showed better results than expected. Thus, they refute the gloomy forecasts dire consequences after the referendum Brexit.

The stable PMI figures for September will throw doubt on the need for additional stimulus from the Bank of England in the coming months. However, the possibility of UK to fall into recession have not vanished. The economy remains vulnerable to further shocks and can not exclude the need for further action by the end of the year.

On Tuesday, the International Monetary Fund (IMF) lowered its forecast for growth in the British economy in 2017 from 1.3% to 1.1%.

The Finance Minister Philip Hammond also considered a possible plan for incentives such as on November 23, will deliver his first speech on the budget. This week, he warned that there are turbulences in the process of preparing to leave the country by the European Union and the negotiation of new trade agreements.

The indices, published this week suggest that the economy grows by 0.3% in the third quarter, in line with the latest estimates of the BoE.

more recommended stories