MNI: UPDATE UK Data Forecasts - September Services PMI

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.

----------------------------

                         Sep

                    Services

                         PMI

                       Index

Date Out              04-Oct

Median                  53.2

Actual

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: jamie.satchithanantham@marketnews.com

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