Free Trial

MNI: UPDATE UK Data Forecasts - September Services PMI

MNI (London)
By Jamie Satchithanantham
     LONDON (MNI) - Having already been dealt the first two September's PMIs,
Wednesday will provide us with the services survey, arguably the most watched of
the three. Services output accounts for roughly 80% of total UK output and
although the Services PMI does not include retail sales it provides a forward
looking estimate to economic performance. 
     The PMI fell to 53.2 in August, an 11-month low, from 53.8 in July with
concerns of subdued client demand and heightened uncertainty about the domestic
economic outlook reportedly weighing on business activity. The September PMI is
also seen unchanged at 53.2.
     Official UK service data showed output decline 0.2% m/m in July, after
rising 0.3% m/m in June (revised down from a previous estimate of 0.4% m/m). The
services data for Q3 is seen as one of the more decisive input factors in the
Bank of England's Monetary Policy Committee's dilemma over when to hike the Bank
Rate and tight monetary policy.
     A weaker June result and a weaker-than-expected July will have dampened
sentiment for a hike within the MPC camp and a healthy September PMI showing
will help restore any lost confidence.
Date Out              04-Oct
Median                  53.2
Consensus               53.2
Forecast High           55.6
Forecast Low              53
Standard Deviation       0.7
Count                     16
Prior                   53.2
ABN Amro                52.8
Barclays                53.1
Berenberg                N/A
Capital Economics       53.4
Credit Suisse           53.0
Commerzbank             53.7
Investec                53.7
JP Morgan               53.2
Lloyds TSB              52.8
Natixis                 53.7
Nomura                  54.0
Oxford Economics        53.0
Pantheon                53.2
RBC                     55.6
Scotia                  53.5
Societe Generale        52.7
UniCredit               53.0
     Earlier this week the first of the two PMIs were published, both showing a
slowdown in activity though to different degrees. 
     The Manufacturing PMI, released Monday, came in virtually in line with the
MNI median (56.0), declining to 59.9 but nonetheless depicts a sector in robust
health spurred by export growth.
     Tuesday's construction survey, however, pointed towards a somewhat bleaker
trend. The headline index fell into contractionary territory in September,
falling to 48.1 from 51.1 in August, with a softening in commercial, civil
engineering (both now sit below the neutral-50 mark) and housing (which fell to
a six-month low). Unfortunately, the latest hard data suggests this trend could
continue; official new orders were down 7.8% q/q in Q2 -- the biggest decline in
five years.     
--MNI London Bureau; +44 203-586-2226; email:
MNI London Bureau | +44 203-865-3812 |

To read the full story



MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.