May composite PMI 53.0 vs 54.1 in April (Il Sole 24 Ore Radiocor) - London , 05 Jun - In May, the UK's purchasing managers' index for the services sector fell to 52.9 from an 11-month high of 55.0 the previous month, but continued to signal sustained expansion, according to data released by S&P Global.

Meanwhile, the composite output index, a weighted average of services PMI and manufacturing output, fell to 53.0 from April's one-year high of 54.1. A reading below 50 signals contracting sector activity, while one above an expansion.

"The PMI survey for May showed another reasonable rate of expansion in the UK service sector," said Joe Hayes, principal economist at S&P Global Market Intelligene. "Taken in tandem with our earlier-released manufacturing survey, the PMIs imply GDP growth of around 0.3% so far in the second quarter.

"Of particular interest to the immediate outlook for the UK economy will be the prices measures, with the Bank of England potentially moving to cut interest rates as soon as this month. The PMI surveys show prices for UK services rising at the slowest pace for over three years. That's now three months on the trot that selling price inflation in the service sector has eased - this will be very encouraging to the Monetary Policy Committee and suggests the trajectory of services prices is moving in the right direction.

"It is worth noting however that the PMI's gauge of UK services inflation is still sitting well above its pre-pandemic trend, which may give more weight to those suggesting the Bank of England hold out until August to loosen policy.".

AAA-Hob

(RADIOCOR) 05-06-24 10:46:29 (0263) 5 NNNN