UK service sector lost momentum in June

The growth rate of the service sector in England fell in June as rising interest rates slowed consumption.

In the statement made by S&P Global/CIPS, the Purchasing Managers’ Index (PMI) of the services sector in the country fell to 53.7 last month. The index was at 55.2 in May.

In the PMI data, a level above 50 indicates growth in the sector and below indicates contraction in the sector.

RISING INTEREST RATES AND WORRIES ARE EFFECTIVE

Tim Moore, Director of Global Market Research at S&P, said: “The services sector again showed signs of vulnerability in June, as rising interest rates and concerns about the UK economic outlook weighed on demand. of customers”.

The Bank of England (BoE) raised the policy rate by 50 basis points from 4.50 percent to 5 percent last month. Thus, within the framework of the tightening policy implemented since December 2021 to reduce inflation, the Bank has increased interest rates for the thirteenth consecutive time.

According to the Office for National Statistics (ONS), annual inflation in the UK held steady at 8.7 percent in May. (AA)