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Corrective Pullback


Risk-On Carries On


Late Trade, March Calls


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  • Highest input costs rise on record. And interesting that higher wages are among the reasons cited - that will be a concern for the BOE. Services output growth looks very encouraging (particularly after stalling over the summer) while manufacturing is suffering with the high costs and supply disruptions.
  • All in all, this looks like a report that will favour the hawks' views on the MPC.
  • From the press release: "Higher wages and worsening supply shortages resulted in a rapid pace of input cost inflation during October. The latest increase in average cost burdens was the fastest since the index began in January 1998. Survey respondents often cited rising fuel, transport and energy bills, alongside steep price increases for items in short supply around the world (especially semiconductors and other electronics components). Output charges at UK private sector firms increased in response to escalating input costs, with the latest rise the steepest since the index began more than two decades ago."
  • "Service sector activity (index at 58.0) outpaced manufacturing production (50.6) by the widest margin since February 2009. The latter saw its weakest output performance for eight months... Measured overall, new business volumes increased at a strong pace in October and the rate of expansion was the fastest for three months"