UK service sector growth rises amid doubts

Britain’s service sector picked up in December, suggesting the economy is holding up well.

The UK services PMI, produced by data firm Markit, has jumped to 54.2 for last month, from 53.8 in November.

Any reading over 50 shows growth, and this is the second-highest score since last April.

Companies reported that business activity growth picked up last month; however, new work and employment numbers rose at a slower pace, according to report by theguardian.com.

Overall, the PMI survey indicates that the UK grew at a pretty steady pace at the end of last year….

Markit PMI “the survey data are consistent with the UK economy having grown 0.4-0.5% in the fourth quarter of 2017. ” #GDP #GBP So steady growth seems to be continuing in the UK

— Shaun Richards (@notayesmansecon) January 4, 2018

However, there are also signs that Brexit uncertainty is deterring some clients from spending money, undermining Britain’s longer-term prospects,

Markit’s Chris Williamson explains:

Digging into the details behind the resilient strength signalled by the headline numbers, the survey data reveal an economy that is beset with uncertainty about the outlook, which is, in turn, dampening business spending and investment.

“Trends in hiring and business investment in fixed assets such as offices are showing signs of deteriorating, as is expenditure on IT, computing and other business services as worries about the Brexit result in delayed spending decisions. Rising price pressures are meanwhile also hurting consumer-facing companies in particular.