The market expects Markit to announce December UK Services PMI figures today at 09:30 UTC. What to expect from the data? See what Key Banks anticipate.
5 January, AtoZForex – UK Services PMI data is about to be announced at 09:30 UTC. UK Services PMI is one of the key indicators of the UK economic health. As businesses respond quickly to changes in the market, the purchasing managers are most likely to have a great insight into the companies’ view of the economy. Thus, UK Services PMI is a discrepancy index based on surveyed purchasing managers in the services industry.
December UK Services PMI outlook
As a fact, any reading above 50 signals industry expansion, where the data below 50 indicates contraction of the sector. Key industry players also eye the release closely. Moreover, they have shared their forecasts on the UK Services PMI.
Societe Generale: UK Services PMI to slip to 54.5
The overall market consensus stands at bearish 54.8 UK Services PMI reading. Societe Generale analysts believe that the after the post-Brexit vote dip, UK Services PMI has strengthened. Even though the industry has consolidated to hit 55.2 in November, the bank expects some slippage in December. The French multinational banking and financial services company stated:
“The strongest performing part of the economy in the second half of this year has been the consumer sector which might then be thought to provide the obvious explanation of the strength of the services PMI. However, the flaw in that argument is that the services PMI exclude distribution – a key part of consumption.”
Societe Generale expects figures to emerge at 54.5, as the company believes that high level of the PMI is not likely to remain sustainable.
Danske Bank: UK Services PMI at 54.2
Another key financial player, Danske Bank states that there is a possibility that UK Service PMI will drop in December due to lower services confidence. The Danish bank analysts have stated:
“We look for a fall from 55.2 to 54.2, which still indicates solid growth in the service sector. Overall, PMIs should continue to signal solid Q4 growth and that the economy is still quite resilient to Brexit uncertainty. That said, we expect GDP growth to slow but stay positive this year.”
Also, GBPUSD is trading higher around $1.2360 two hours ahead of the report. Yesterday’s FOMC minutes emerged on the hawkish side, even though they failed to provide the greenback with further support.
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