Economic activity in the UK slowed markedly in April amid worsening inflation, not least record rises in firms’ costs, and a gloomier outlook, the results of a batch of closely-followed surveys showed.
S&P Global’s ‘flash’ composite Purchasing Managers’ Index Composite Output Index fell from a March reading of 60.9 to 57.6 for April (consensus: 58.5).
The preliminary reading on the headline PMI for just the manufacturing sector in fact edged up from 55.2 to 55.3 (consensus: 54.0).
However, orders received by manufacturers nearly stalled, the survey compiler said, due to an increasing loss of exports.
The services PMI meanwhile declined from 62.6 to 58.3 (consensus: 60.0) and was at among the weakest since the lockdowns of early 2021.
According to Chris Williamson, chief business economist at S&P Global, firms’ “cautious” approach to hiring and spending in the face of cooling demand and gloomier outlook suggested that the slowdown in the economy had further to run.
“While the start of the year saw businesses in high spirits amid the reopening of the economy, this ebullient mood is being eroded by concerns about the rising cost of living, the Russia-Ukraine war, lingering pandemic disruptions and rising interest rates.”