UK services firms reported a second month of growth, with prospects improving. Photo: Peter Nicholls/Reuters
The UK’s services sector enjoyed its strongest growth in new business in a year amid growing confidence among customers in both domestic and international markets.
The S&P Global/CIPS UK Services PMI survey showed a reading of 52.9 last month, down from February’s score of 53.5. Any reading above 50 is considered growth.
Tim Moore, director of economics at S&P Global Markets, said: “The March data confirmed that the UK services sector returned to growth during the first quarter of 2023, with a sustained return to new orders and improving business and consumer confidence.” Has happened.” Intelligence said.
The PMI survey showed business expectations improving for the fifth consecutive month, and optimism about business prospects was the highest since March last year.
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UK firms said they had seen the strongest growth in new export sales since 2014, when record-keeping began.
“Export sales provided an additional boost to the services economy during March as the ongoing recovery in business travel and events helped drive the fastest increase in new orders from overseas for at least eight and a half years.
“Tight labor market conditions remain a drag on business potential in the services sector and fuel another month of historically high wage pressures.
Read more: UK manufacturing output returned to decline in March
“However, overall business spending grew at its slowest pace since May 2021 as lower transportation bills and falling commodity prices helped offset rising employee costs,” Moore said.
However, some companies were concerned about a rise in interest rates from the Bank of England and Chancellor Jeremy Hunt’s corporate tax hike.
The service sector accounts for about 80% of Britain’s economic output.
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