UK June final services PMI 48.8 vs 48.7 prelim

June Services PMI

48.8

Final services PMI for June, indicating contraction in the service sector.

Final Composite PMI

49.3

Final Composite PMI for June, slightly below the preliminary estimate of 49.4.

Prior Services PMI

49.3

Prior services PMI for May, indicating a decline from the previous month.

§ 01 Executive Snapshot

What: The UK services PMI for June was reported at 48.8, indicating a decline in service sector activity.
Who: S&P Global Market Intelligence and Tim Moore, Economics Director.
Why it matters: This data reflects a significant loss of momentum in the UK economy, marking the steepest decline in service activity since January 2023.

Final Composite PMI was reported at 49.3, compared to a preliminary estimate of 49.4.
Service sector activity has declined for the second consecutive month, with the rate of decline being the steepest since January 2023.
New orders in the service sector decreased for the fourth month in a row.

The decline in service sector activity represents a shift from a positive economic start to the year, highlighting potential vulnerabilities in the UK's economic recovery.
The economic pressures are compounded by geopolitical uncertainties, particularly related to the Middle East conflict, which is affecting business sentiment and investment.

The immediate implication is a fragile investment sentiment and increased risk aversion among clients, which could lead to further economic contraction.
Long-term implications may involve a prolonged period of economic uncertainty and potential adjustments in business strategies to navigate ongoing challenges.

Potential risks include ongoing geopolitical tensions that could exacerbate economic uncertainty and impact consumer spending.
There are also risks related to rising input costs and inflation, which could squeeze profit margins for service sector firms.

Future developments to watch include any significant changes in the geopolitical landscape, particularly regarding US-Iran relations, which may influence business confidence.
Monitoring inflation trends and input cost dynamics will be crucial to assess how they impact service sector performance in the coming months.

§ 07

What does a PMI of 48.8 indicate for the UK services sector?

A PMI of 48.8 indicates a decline in service sector activity, marking the steepest decline since January 2023.

Why is the decline in service sector activity significant?

The decline reflects a significant loss of momentum in the UK economy and highlights potential vulnerabilities in its recovery.

How have new orders in the service sector changed recently?

New orders in the service sector have decreased for the fourth consecutive month.

What risks are associated with the current economic situation in the UK?

Risks include ongoing geopolitical tensions, rising input costs, and inflation, which could impact consumer spending and profit margins.