UK services PMI drops to lowest level since 2010

UK services PMI drops to lowest level since 2010

After an uptick in August, probably related to the Olympic Games, UK services PMI weakened for a second straight month in October. At the start of the fourth quarter, UK services PMI dropped from 52.2 to 50.6, while only a marginal weakening, to 52.0 was forecast. The UK services PMI is now at its lowest level since December 2010. Worryingly, weakness was led by the forward-looking indicators as both business expectations and new orders edged down, a poor sign for the coming months. After a strong third quarter, boosted by the Olympic Games, the first signs of the fourth quarter are poor for the UK economy, suggesting that growth will slow again in the final quarter of the year as both the manufacturing and services PMI weakened significantly in October.