UK private sector grows at fastest rate for 11 months
Economists said the data is a further signal that the UK’s economy gained momentum to leave the recession seen at the end of 2023.
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Your support makes all the difference.The UK’s private sector grew at its fastest rate for almost a year this month, on the back of strong growth for the country’s services industry.
The fresh economic data was a further signal that the UK’s economy gained momentum to exit the recession seen at the end of 2023, according to experts.
On Tuesday, the closely-watched S&P Global/CIPS flash UK purchasing managers’ index (PMI) reported a reading of 54 in April, up from 52.8 in March.
The flash figures, which are based on preliminary data, were the highest reading since May last year.
Any score below 50 indicates that activity is contracting, and any score above means it is growing.
Chris Williamson, chief business economist at S&P Global Market Intelligence said: “Early PMI survey data for April indicate that the UK economy’s recovery from recession last year continued to gain momentum.
While the improving economic recovery picture is welcome news, the upward pressure on inflation will add to concerns that a sustainable path to below target inflation has not yet been achieved
“Improved growth in the service sector offset a renewed downturn in manufacturing to propel overall business growth to the fastest for nearly a year, indicating that GDP (gross domestic product) is rising at a quarterly rate of 0.4% after a 0.3% gain in the first quarter.”
Service sector firms reported an acceleration of growth over the month to the strongest level for 11 months, the survey found.
Companies highlighted rising business and consumer spending, supported by a recovery in broader economic conditions.
However, manufacturing production declined for month, slipping back from growth in March.
Lower output level were linked to “weak market conditions and customer destocking in line with reduced demand”.
The data also showed that input price inflation accelerated in April, with the services sector facing the steepest cost inflation since last July.
Mr Williamson added: “The upturn encouraged firms to take on workers in increased numbers which, alongside April’s rise in the National Living Wage, drove cost pressures sharply higher.
“While the improving economic recovery picture is welcome news, the upward pressure on inflation will add to concerns that a sustainable path to below target inflation has not yet been achieved.”