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UK’s services sector returns to growth in November

Revised figures indicate that activity in the dominant services sector expanded for the first time since July.

5 December 2023

November Services PMI data for the UK showed a slight bounce in activity with a reading of 50.9 (improving on the initial flash estimate of 50.5). This is some relief for the services side of the economy which accounts for approximately 80% of UK Gross Domestic Product and had been in contraction for the three months prior. However, the report showed that demand remained subdued - despite the slight increase in new orders - as inflationary fears remain front and centre.

Overall business optimism moved slightly higher although it is still not quite a majority view (48% of the survey expect activity to grow during the next year). Worries amongst the survey respondents continue to be the structurally higher borrowing costs impacting business decisions. Some pointed to increased geopolitical threats although optimism for lower inflation next year was also cited as a major positive for sentiment.

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The information in this document is given for information purposes only and does not qualify as investment advice. Opinions and assessments contained in this document may change and reflect the point of view of GAM in the current economic environment. No liability shall be accepted for the accuracy and completeness of the information. Past performance is not an indicator for the current or future development.

Charles Hepworth

Investment Director
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