S&P Global’s UK Services PMI rose to 52.7 in April, up from 50.5 in March – the lowest reading since April 2025 – and slightly ahead of the 52.0 flash estimate. The bad news for Reeves is in the inflation numbers…
Service providers logged the fastest rise in costs since November 2022, with prices charged jumping to a three-year high.
S&P Global’s Tim Moore said:
“April data signalled a modest recovery in UK service sector output growth after the considerable loss of momentum seen in March. However, this improvement could easily prove short-lived as new business intakes remained subdued in comparison to the start of 2026. Survey respondents widely noted that the Middle East conflict and subsequent global supply chain disruptions had weighed heavily on business and consumer confidence.
“Business activity expectations for the year ahead edged up only slightly from March’s nine-month low, largely reflecting concerns about the broader economic outlook and escalating inflationary pressures.
“Service providers recorded the fastest rise in average cost burdens since November 2022, which was overwhelmingly linked to greater transportation bills and increased salary payments. A number of firms also noted that they had brought in fuel surcharges for their customers, which led to a spike in prices charged inflation across the service economy to its highest for over three years in April.”
Reality is about to bite…
Speaking at his speech on how to achieve “progressive capitalism” Wes Streeting fired a dig and Andy Burnham:
“Bond markets are not bond villains and fiscal rules matter.”