UK Dec services PMI surprises positively once again, hits 17-month high

The services sector activity in the UK economy showed an unexpected improvement and surprised markets to the upside in the month of December, a fresh report from Markit Economics showed on Thursday. The rebound marked the highest levels in seventeen-months. 

The services PMI extended its strong run of increases into a third month, expanding to 56.2 in Dec versus a 55.2 reading booked in Nov. Markets predicted a drop to 54.7 in Dec.

Key Points:

Growth accelerates for third straight month to 17-month high

New business increases at fastest rate since July 2015

Output price inflation hits 68-month record

Chris Williamson, Chief Economist at Markit, noted: “A buoyant service sector adds to signs that the UK economy continues to defy widely-held expectations of a Brexit-driven slowdown. The faster growth of services activity follows similar news of improvements in the manufacturing and construction sectors at the end of 2016.”

“Collectively, the PMI surveys point to the economy growing by 0.5% in the fourth quarter, with growth accelerating to a 17-month high at the year-end.”