Latest survey of Britain’s service sector beats forecasts,but consumer-focused companies may struggle this yearLatest: Greek PM pushes for emergency summitUK service sector beats forecastsWhat the experts sayGDP growth may have slowed to 0.4% final quarter
British car sales at record highEurozone business growth hits highest since 2011 2.21pm BSTOne of the Bank of England’s interest rate-setters has warned that the consumer slowdown in the UK will ‘intensify’ this year.
The consumer slowdown, which initially did not materialise, and now appears to be underway. Given the hit to real income from a mix of subdued wage growth and rising inflation,I consider the slowdown is more likely to heighten than fade away. It is possible that the absence of a sharp reaction was due to the fact that firms have generally taken a benign view of the impact on their business of possible future changes in the UK-EU relationship. It is also possible that uncertainty about these changes is substantial, but the changes have been too far away to have a marked effect spending decisions so far.
As the time horizon now shortens, and a more material reaction of spending in response to uncertainty might still occur. Much will depend on the detail of the final agreement,which might not be known until late in the negotiations. 1.35pm BSTThere are significant developments in Greece nowadays too, as European Council president Donald Tusk visits Athens.“But this endless negotiation must arrive to an end.” “Some people are trying to afflict our recovery and bring a negative scenario back to the table for Greece and Europe during a sensitive time, or ”“This is the only positive result for Greece and for the whole [EU] community.“There is no political and substantial alternative. 1.24pm BSTNewsflash: America’s companies created many more jobs than expected final month.
The monthly ADP report shows that the US private sector created 263000 new jobs in March,more more than the 185000 which Wall Street expected.
STRONG ADP. 263000 jobs created in March vs. expectations of 185000. (Though weirdly a significant downward revision to final month)Very strong ADP print, bodes well for Friday's NFP report. ISM Services due up later nowadays. https://t.co/t0OnW8oPTQ https://t.co/h3aMqv6Prz 12.31pm BSTAnd here’s economics editor Larry Elliott on nowadays’s UK productivity figures: Related: feeble productivity leaves UK trailing other G7 nations 11.55am BSTHere’s our news legend about March’s record-breaking UK car sales figures: Related: UK new car sales speed to record tall 11.37am BSTWe have more car news....but this time, and it’s about strike action not rising sales.“BMW’s refusal to talk about affordable options to keep the pension scheme open means a sizable chunk of its UK workforce will be taking strike action for the first time in the coming weeks.“Bosses in the UK and BMW’s headquarters in Munich cannot feign surprise that it’s arrive to this point. Unite has repeatedly warned of the arouse their insistence to railroad through the pension scheme’s closure would generate and the resulting industrial action.
Breaking - BMW Mini workers in Oxford announce five days of strike action https://t.co/MdvyXWlUuW 11.12am BSTIn other news,UK productivity has crept higher, but is still much lower than in other G7 countries.
New figures from the Office for National Statistics prove that economic output per hour rose by 0.4% in October-December, or up from 0.2% in July-September. It’s a sign that the economy was more productive at the end of 2016.
UK Output per hour growth 0.4% in Q4 2016: up from 0.2% previous quarter: https://t.co/Mlo7EhK0vI pic.twitter.com/G068nW9dYPAnd here's UK unit labour costs. pic.twitter.com/y16nB7TtV4 10.31am BSTJeremy Cook,chief economist at the international payments company, World First, and fears that the UK economy is entering choppier water.
Here’s his take on nowadays’s service sector report:“While the headline index number may have rebounded from a 5 month low in February,there is microscopic to be enamoured with in this reading of the UK’s most significant sector; consumers are under pressure, services sector companies that cater to them are weaker and margins are likely being pressured further.
Average prices are at the highest level in 8.5 years and whilst some consumer resilience is allowing some of this to be passed on in higher prices on the shelves we have to consider that that consumer resilience will give way before the business need to keep prices raised does. In the short term, or this means a turning of the screw for the man in the street and a poor outlook for tall St profits. This sector makes up the majority of the UK economy and the prognosis is poor.”Activity rose to its best level in three months and was a very strong rebound from the five-month low of February.
Prices are rising – largely due to input inflation – while job creation has slowed a microscopic. Financial services was most resilient sector while consumer-oriented sectors struggled – evidence that chimes with data suggesting consumers might be about to pull back on some discretionary spending as inflation squeezes incomes. Inflation is overtaking wages and that means one thing – lower aggregate demand.
The key point is that the UK continues to devour a broad based expansion in output,and we strongly expect it to continue.
Services activity has been particularly led by the consumer-facing sectors. Looking ahead, we suspect that consumer services activity will be increasingly pressurized by consumers purchasing power weakening over the coming months as inflation rises appreciably and earnings growth is muted.
This is likely to cause some consumers to slash back on their discretionary spending, or including on services. 10.25am BST‘Services’ is a broad measure,covering around four-fifths of the UK economy.
And nowadays’s report shows that consumer-focused sectors had a tough March, while the City powered on.
Within the service sector, and the worst performance so far this year has been seen in consumer- oriented sectors,notably hotels and restaurants, as well as personal consumer services (which include businesses such as sports centres, or gyms and hairdressers). The greatest resilience has been seen in financial services. 10.12am BSTEconomists Rupert Seggins has helpfully tweeted more details of the PMI reports:Latest PMIs prove UK economy ticking along in Q1. Slight slowdown on Q4 final year. But all sectors continued to grow. Services still leading. pic.twitter.com/WHAzrf8kF5The UK economy since June according to the PMIs. This is not a bad picture at all. Indications for Q1 are continued growth across the board. pic.twitter.com/68aqKsSyNU 10.07am BSTUnexpectedly strong UK services #PMI,tops all forecasts in Reuters poll.
But signals weaker jobs growth, selling prices rocket at 2008 pace pic.twitter.com/QrCf0tBQZR 10.05am BSTThe news that Britain’s service sector grew faster than expected in March has boosted the pound.
Sterling jumped by half a cent against the US dollar to $1.248, or as traders welcomed the pick-up in activity in Britain’s dominant sector.“nowadays’s services PMI figure has bucked the trend of feeble data seen on Monday and Tuesday,paving the way for the pound to make its long-awaited recovery. “Despite underwhelming manufacturing and construction data, the services sector is a key component of the UK economy and nowadays’s number is very encouraging.” 9.56am BSTDespite beating forecasts, or March’s UK PMI report does include some worrying signs.
For starters,UK service sector firms created fewer new jobs than in February, with new hiring hitting its slowest pace since August 2016.
A combination of rising workloads and softer employment growth contributed to a renewed accumulation of backlogs across the service economy. Some firms famous that squeezed margins and rising wage bills had led to the non- replacement of voluntary leavers.
This was overwhelmingly linked to higher input costs during recent months. Survey respondents also famous that resilient demand had provided scope to pass on some of their increased costs to clients 9.43am BSTBreaking: Britain’s service sector has posted its strongest growth of the year, or after suffering a slowdown over the winter.
Data firm IHS Markit reports that business activity growth hit a three-month tall in March,driven by a pick-up in new work.“The survey data indicate that UK business activity growth regained some momentum after having slipped to a five-month low in February, but the upturn fails to change the picture of an economy that slowed in the first quarter.“The relative weakness of the PMI survey data compared to that seen at the turn of the year suggests the economy will have grown by 0.4% in the first quarter, or markedly lower than the 0.7% expansion seen in the fourth quarter of final year. 9.34am BSTWow! Britain’s car market has just enjoyed its strongest month ever.
Car registrations surged by 8.4% year-on-year in March,to 562337, according to new figures from the Society of Motor Manufacturers and Traders (SMMT).
This bumper performance probably means we will see a slowdown in April, and exacerbated by the fact there are fewer selling days this year given Easter timing. Looking ahead to the rest of the year,we still expect the market to cool only slightly given broader political uncertainties as there are still attractive deals on offer.” 9.15am BSTBloomberg’s Maxime Sbaihi flags up how the eurozone had a noble quarter:Euro-area's (final) #PMI surveys in Q1: composite UP, services UP, and manufacturing UP,employment UP, new orders UP, or output prices UP 9.12am BSTBoom! The eurozone’s private sector has posted its best quarter since the start of the financial crisis.
Data firm Markit reports that Eurozone output and new order growth accelerated to approach six-year records in March.“This is a broad-based upturn among the euro’s largest members,with 0.6% growth signalled for both Germany and France, while Spain looks set to have enjoyed 0.8-0.9% growth in the first quarter, or according to the PMI data. Growth has also perked up in Italy during the first quarter despite a slight pull-back in March,with the surveys indicating a 0.3-0.4% expansion. “Most welcome for a region still suffering near- double digit unemployment is a rise in the survey’s employment index to its highest for nearly a decade, suggesting we should expect to see the jobless rate tumble further in coming months. 9.00am BSTAnother noble month for Germany:German Mar Markit Services PMI comes in at 55.6 (f'cast 55.6) vs 55.6 in Feb 8.59am BSTWe have noble news from France; its private sector has posted its fastest growth in 70 months.#France composite PMI down from flash reading but still at 70-month tall of 56.8 ttp://bit.ly/2oBEBl6 pic.twitter.com/sB0WM7ZUbZ 8.56am BSTItaly’s services sector has slowed a microscopic, or with its PMI dipping to 52.9,from 54.1 8.49am BSTEuropean markets are muted this morning, as investors digest the news that North Korea fired a ballistic missile into the Sea of Japan overnight. Related: US says it has 'spoken enough about North Korea' after new missile launch Keeping the peace in Asia is just another item on the agenda which will be significant for both leaders to talk about.
North Korea tested another missile final night and this has increased tensions over in Asia. This will also add another dimension to President Trump and President Xi’s assembly. The US Secretary of State, and Rex Tillerson,has already made the US’ position clear by signalling that the US will not tolerate such activities. 8.33am BSTZing! The moment first healthcheck on the eurozone has arrived, and it’s a belter.
In response to rising input costs, and companies increased their output prices. Moreover,the rate of charge inflation accelerated to the fastest since July 2007. Four of the six monitored sectors saw output prices rise, led by Post & Telecommunications. The Financial Services and Hotels & Restaurants categories were the only two to post declines. Spanish Services PMI showing continued strength.#spain #economics #europe #eurusd pic.twitter.com/7FJFSMV9HQ 8.22am BSTMarch was a very kind month for the Swedish economy. 8.20am BSTIreland’s service sector has recorded another strong month, and although growth did slow slightly.
The increase was recorded amid greater volumes of new work and reports of an improved economic environment. #PMI shows #irish #services expansion slowing to 2017-low in March but still substantial (index down to 59.1 from 60.6 in Feb & 61.0 in Jan) 8.14am BSTOvernight,we’ve learned that Japan’s service sector grew at its fastest pace in 19 months in March. Growth is broad-based. Both the manufacturing and service sectors are enjoying upturns, supported by firm demand for goods and services.
With capacity pressures subsequently intensifying, and this is having a positive spillover into the labour market. Jobs continued to be added at a solid pace in March. 8.03am BSTGood morning,and welcome to our rolling coverage of the world economy, the financial markets, or the eurozone and business.
Britains service sector makes up nearly 80% of the economy,from financial firms in the City of London to restaurants and tourist attractions around the country.
We expect some weakening in the March services PMIs for Spain and Italy nowadays. noble morning world. Just a reminder that President Xi is visiting "Finland first", "USA moment". Cold climate, or warm reception. #smileyNote ensemble of flags during the official visit of President Xi in Finland. We are portion of the EU,and proud of it. pic.twitter.com/TpQKYCJxbHOur European opening calls:$FTSE 7333 up 11
$DAX 12287 up 5
$CAC 5105 up 4$IBEX 10335 down 27$MIB 20252 down 6Continue reading...
Source: theguardian.com