UK Businesses Grow For The First Time In Three Months, But High Rates Weigh

• British companies reported a marginal return to growth in November, with the S&P Global/CIPS UK Composite Purchasing Managers' Index (PMI) reaching 50.1, up from 48.7 in October. This is the first time the index has crossed the 50 threshold for growth since July.
• Despite the growth in overall economic activity, the downturn in orders continued for the fifth consecutive month, indicating a persistently weak economy.
• Following the announcement, the sterling strengthened against the dollar and the euro, while British government bond prices fell. Market expectations for the Bank of England to cut interest rates were pushed back.
• While the PMI for the services sector was positive at 50.5, the manufacturing sector signalled a decline in output at 46.7. Respondents reported concerns about persistent inflation, and although firms were more optimistic about the future, forward-looking indicators suggested elevated recession risks in the coming year.

 (Source: Reuters)