India's Private Sector Expands Marginally In November

India's Private Sector Expands Marginally In November

Activity in the U.K.'s heavyweight service sector eased in November, slowing from the previous month's six-month high, a closely-watched survey showed Tuesday.

The monthly IHS Markit/CIPS services Purchasing Managers' Index (PMI), covering businesses from hotels to hairdressers, fell to 53.8 in November from to 55.6 in October, at the low end of most forecasts from economists polled by Reuters.

The latest reading was the highest for five months and signalled a solid rate of business activity growth across the sector. Charge inflation quickened to the strongest since July, but was modest as firms were unable to fully pass on higher cost burdens to price-sensitive clients.

Bolstered by the improvement in the service sector, the Caixin China Composite Output Index, which covers manufacturing and service companies, rebounded to 51.6 from October's 16-month low of 51. The latest reading signalled a solid increase in the biggest sector of the United Kingdom economy, but showed the rate of expansion was slightly slower than the average for this year.

The latest services PMI follows the manufacturing one announced December 1, which showed that robust growth in manufacturing sector during November.

"Panellists widely blamed the deterioration in business performance due to the goods and service tax (GST), which led to a fall in the new orders index", according to the Nikkei PMI press release.

A number above 50 points to an expansion in activity, while anything below that indicates a contraction.

Threadneedle Street raised interest rates for the first time in a decade in November, up from 0.25% to 0.5%, as the Bank's governor Mark Carney said the vote to leave the European Union had constrained the speed at which the United Kingdom could grow before prices begin to spiral.

"Heading into 2018, the big questions will be how long this growth spurt can be sustained, and whether price pressures will rise", Williamson said, adding that data suggest "inflationary pressures will pick up next year". "The survey data are so far consistent with the economy growing at a quarterly rate of 0.45 per cent in the closing months of 2017".

Costs also increased, with survey respondents saying they had to pay more for energy, food, fuel, imported items and staff.

Duncan Brock, director of customer relationships at the Chartered Institute of Procurement & Supply (CIPS), said: "November's data painted a disappointing portrait of a sector struggling against Brexit-related uncertainty and a weaker economic outlook".