This Helped the UK Services PMI Post Gains in July
The UK Services PMI in July
According to a report by Markit Economics, the UK Services PMI (purchasing managers’ index) stood at 53.8 in July 2017, compared with 53.4 in May, beating the market expectation of 53.6.
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The improvement in the UK Services PMI in July is mainly due to the improvement in new business orders and export orders for the month. Production output also rose in July, while job growth rose to a 17-month high.
UK’s election outcome
The UK’s (EWU) general election outcome in June 2017 created doubt in the nation’s political environment. The instability in the political environment after the UK election affected consumer confidence and hampered the country’s domestic demand in June. But in July, it recovered a bit.
However, the UK’s business expectations for 2017 remained weak compared with 2016, as Brexit negotiations continue to complicate matters. Many policymakers have warned that the UK is headed for a “hard Brexit.”
However, the economy posted 0.3% growth in its 2Q17 GDP, beating the market’s expectation of a 0.3% rise, and the services sector contributed more to growth in 2Q17. The improvement in the UK Services PMI also indicates that sector is doing well in the economy.
In the next part, we’ll explore the performance of the Japan Services PMI (EWJ) for July 2017.