The UK’s Chartered Institute of Purchasing & Supply (CIPS) announced on Wednesday that its latest Markit/CIPS Purchasing Managers’ Index (PMI) for the services sector registered at 56.9 for June this year, an increase from 54.9 in May.
The results of the survey point to an improving economy, as the figure is above 50 which indicates growth in the service sector, which accounts for about 75% of the economy. The news follows reports earlier this week that June PMI survey for the UK manufacturing sector also indicated the strongest growth in two years, while employment is said to be rising at the fastest pace for more than five years.
CIPS CEO David Noble said: “The UK services sector finished off Q2 with a stellar performance in June, giving the clearest signal yet that the worst days of the financial crisis are behind us. The UK’s largest industry recorded the fastest growth in new business for six years and the sharpest increase in employment over a similar period. These figures, taken in conjunction with manufacturing and construction, mark a good first week for the new Bank of England Governor and will ease pressure on the MPC to embark on another round of QE.”
However he added: “As ever, a handful of issues remain. The macro-economic environment remains uncertain and competition remains fierce. At the same time, whilst output prices rose, firms are still struggling to pass on the full extent of input price rises to clients. Overall however, worse problems have beset the sector in recent years so confidence is rightly high. Barring any major changes to the global economy, we can be optimistic about sustaining this growth as we go into the second half of the year.”