Prior 49.3Manufacturing PMI 53.1 vs 53.5 expectedPrior 53.9Composite PMI 49.4 vs 50.6 expectedPrior 49.7
Key Findings:
UK private sector output continues to stutter amid sharper decline in service sector activity
Comment:
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence:
“A disappointing June ‘flash’ PMI indicates that the economy contracted for a second successive month, albeit at only a 0.1% rate and merely flat-lining over the second quarter as a whole.
“Price pressures remain elevated as companies point to the energy shock and supply squeeze from the war in the Middle East as exacerbating existing cost pressures from government policies.
“These higher costs, combined with subdued business growth expectations for the year ahead, have caused employment to continue to fall at a worryingly high rate.
“While current weakness is focused on consumer-facing services, an offsetting expansion of the manufacturing sector could soon falter, as demand here is being temporarily buoyed by the building of safety stocks amid ongoing war related supply worries.
“Some of the war-related price pressures have started to moderate, however, largely thanks to lower energy prices, and the subdued growth and labour market pictures suggest that demand and wage-bargaining power are sufficiently slack to prevent inflation becoming entrenched.
“For the growth and inflation outlooks, much depends on progress towards an end to the conflict in the Middle East, but closer to home we are seeing signs of the unstable political environment unsettling business confidence and delaying spending, which will also need to calm in order to lay better foundations for economic growth to revive.”
This article was written by Giuseppe Dellamotta at investinglive.com.