The decline in private sector activity in the UK in September points to a 0.4% fall in gross domestic product (GDP) in the third quarter, according to results from S&P Global’s PMI survey.
Specifically, the preliminary estimate of the composite PMI in the ninth month of the year was 46.8 points, compared to 48.6 in the previous month, the worst result in 32 months.
In the services sector, the PMI index fell to 47.2 points in September from 49.5 in August, also the worst in 32 months. UK manufacturing activity, in turn, saw an increase, taking the PMI to 44.2 points from 43 in August.
The document prepared by the rating agency shows that despite the upward pressure on fuel prices, input prices recorded their sharpest decline in 2023. S&P has said the combination of “weak” demand and containment of cost inflation contributed to the lowest increase in selling prices since February 2021.
“The sharp decline in manufacturing indicated by the ‘flash’ PMI data is consistent with a quarterly GDP decline of up to 0.4%,” said Chris Williamson, chief economist at S&P Global Market Intelligence, who received the report Described data as “disappointing” and “providing few opportunities for immediate improvement.”
In this sense, Williamson has declared that the “setback” in September was the biggest since the 2009 financial crisis, if one ignores the months of lockdown imposed during the pandemic.