UK services PMI declined moderately in November - IHS Markit/CIPS

November data from IHS Markit/CIPS pointed to a renewed drop in business activity across the UK service sector and, although only marginal, the pace of decline was the fastest for eight months. Subdued demand continued to hold back business activity during the latest survey period, as signalled by the sharpest fall in new work since July 2016. On a more positive note, input cost inflation eased again in November and reached its lowest level for just over three years.

At 49.3 in November, down from 50.0 in October, the seasonally adjusted UK Services PMI Business Activity Index signalled a marginal reduction in service sector output. Economists had expected a fall to 48.6. Although the index was up from the earlier 'flash' reading of 48.6 in November, it still pointed to the steepest decline in business activity since March. Survey respondents noted that domestic political uncertainty once again led to cautious business and consumer spending. Incoming new work decreased for the third consecutive month in November and the rate of contraction accelerated to its sharpest for over three years. Demand from export markets was particularly weak, with the latest drop in new orders from abroad the fastest since this index began in September 2014. 

At 49.3 in November, the seasonally adjusted IHS Markit/CIPS UK Composite Output Index was down from 50.0 in October and signalled a marginal reduction in private sector output. The index was up from the earlier 'flash' reading of 48.5 in November, but still the joint-lowest figure since July 2016 (equalling that seen in September).