<ul><li>Composite PMI 49.0 vs 49.0 prelim</li></ul><p style=““ class=“text-align-justify“>Little change to the initial figures as the UK services sector flatlining more or less with overall business activity marginally lower in the final month of last year. The good news is that price pressures are lower but they do remain high from a historical perspective. S&P Global notes that:</p><p style=““ class=“text-align-justify“>“UK service providers ended the year with another downturn in new orders as strong inflationary pressures and worries about the economic outlook sapped demand. Overall levels of business activity fell only fractionally, despite an exceptionally challenging business environment and spending cutbacks due to cost of living difficulties. </p><p style=““ class=“text-align-justify“>“Stalling recruitment and lower backlogs of work added to signs that service sector companies are now experiencing fewer capacity pressures. Business optimism has recovered from the lows seen in the wake of last September’s ‚mini Budget‘, but many firms are braced for a sustained period of subdued demand in 2023. </p><p style=““ class=“text-align-justify“>“Around 40% of the survey panel expect a rise in business activity over the next 12 months, while 16% forecast a decline. Survey respondents commented on squeezed disposable incomes, elevated recession risks and a housing market downturn as key factors likely to constrain demand in the year ahead. Although service providers widely noted concerns about global economic headwinds and stubbornly high <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_1″ class=“terms__main-term“>inflation</a>, there were also many reports citing positivity about factors within their control, including forthcoming product launches, expansion into new markets and planned business investment.“</p>
This article was written by Justin Low at www.forexlive.com.
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