Data published by IHS Markit/CIPS showed that in November, the UK services sector will continue to expand, but the growth rate has slowed compared to October, when a three-month high was reached.
Services PMI dropped to 58.5 points compared to 59.1 points in October. Economists had expected a decrease to 58.6 points. However, the latter value was higher than the average for the third quarter (56.7 points).
The data showed that the growth rate of new orders accelerated in November and was the highest since June, helped by higher business and consumer spending. Meanwhile, export orders recorded the highest growth rates for more than 4.5 years amid an increase in the number of travel bookings and higher levels of spending by overseas visitors. As for personnel, the ninth monthly increase in the number of jobs was recorded in November, but the growth rate was the lowest since July amid difficulties in finding the right candidates. Meanwhile, the number of unfinished work increased again in November, while the rate of increase was the highest in 4 months.
As for inflation, production costs increased again in November, while the rise in raw material prices was the strongest in the entire history of observations (25 years). Selling prices also rose at a record pace in November, due to higher operating costs.
Meanwhile, the degree of optimism about business activity growth was the lowest for 12 months.