UK services PMI sees a solid upturn in Dec, a positive surprise

The services sector activity in the UK economy rebounded sharply and surprised markets to the upside in December, a fresh report from Markit Economics showed on Thursday.

The services PMI jumped to 54.2 in December versus a 53.8 reading booked in November. Markets predicted an expansion to 53.8 last month.

Key Points:

Sharper rise in business activity in December.

New order growth eases to a 16-month low.

Input price inflation hits a three-month high.

Chris Williamson, Chief Economist at Markit, noted: “December saw a welcome upturn in service sector activity, highlighting the continued resilience of the economy as 2017 came to an end. Alongside the solid expansion seen in manufacturing and modest construction sector upturn, the survey data are consistent with the economy having grown 0.4- 0.5% in the fourth quarter of 2017.”