UK Services Surge to 7-Month High as Manufacturing Hits 18-Month Low on Export Weakness
By: James Hyerczyk
Published: March 24, 2025, 09:42 GMT+00:00
The recent data reveals a striking divergence in the UK private sector. Services PMI shot up to 53.2 in March, signaling a demand rebound, while manufacturing fell to its lowest point in 18 months due to export challenges.
Key Points
- Services versus Manufacturing: Services PMI increased significantly, showcasing the strongest growth since August 2024.
- Manufacturing Struggles: Manufacturing PMI dropped to 44.6, indicating severe contraction.
- Job Market Trends: Continued job losses in the private sector, particularly in manufacturing.
Summary
The contrast between services and manufacturing reflects the current economic landscape in the UK. While manufacturing battles against escalating export pressures and increased tariffs, the services sector capitalizes on a recovery in domestic and overseas sales.
Opinion & Analysis
The latest data highlights significant risks in the market. Businesses in manufacturing reported the weakest sentiment since late 2022, driven by worries about trade and tariffs. In contrast, confidence in the services sector has begun to stabilize as recovery signs emerge.
Economists suggest these mixed signals may lead to cautious approaches from the Bank of England, particularly regarding interest rate adjustments.
Considerations for Traders
Traders should keep an eye on upcoming US tariff decisions and fiscal changes in April, as these could steer market sentiment and economic forecasts significantly.