Growth in UK Economy Slows Slightly as Purchasing Managers’ Index Take a

The all-sector PMI, a composite of the services, manufacturing and construction surveys, fell to 56.7 in July, its lowest since December 2014, from 57.4 in June. “Nonetheless, the rate of job shedding was only marginal as around 96% of panellists reported no change in employment from the levels recorded in the prior month”, the report said. The PMI reading was lower than the Caixin preliminary July prediction of 48.2 and 50 in the official manufacturing PMI released Saturday.

Anecdotal evidence suggested that stronger underlying client demand and new customer wins led to increased new work at service providers, according to the Caixin report. While the survey indicated that growth in the Eurozone’s service sector had slowed, it is only slightly less than June’s four-year high.

The survey showed deteriorating business conditions forced firms to cut staffing levels for the 21st straight month. Selling prices were unchanged on average, with companies highlighting efforts to secure new business, Markit said. “When looking at the manufacturing and service sectors together, weak inflationary pressures and modest growth tend to support a more accommodative monetary policy environment”, senior economist at Markit Andrew Harker said.

Paul Hollingsworth of Capital Economics said: “Looking ahead, though, weak overseas demand and an uncompetitive exchange rate look set to hold back the sector’s recovery in the near term”.

Meanwhile, in the eurozone – and despite the Greek crisis – July’s PMI of 52.4 was only fractionally lower than June’s 14-month high.

Said Annabel Fiddes, an economist at Markit: “Private sector companies in Singapore signalled a further robust expansion in output at the start of the third quarter, which in turn contributed to the first increase in staff numbers for five months”.

The government has taken a series of steps since last year to try to put a floor beneath sputtering economic growth, including accelerating infrastructure spending and repeated reductions in interest rates and banks’ reserve ratio.