British Services Sector Shows Strong Recovery Signs

The headline seasonally adjusted IHS Markit/CIPS UK services purchasing managers’ index (PMI) for business activity posted 47.1 in June, up from its level in May at 29, reaching its highest level in four months.

The index survey showed that around 33% of participants reported a drop in business activity during June, compared with 54% in May and 79% in April. On the other hand, 28% of businesses signaled an expansion.

Thus, the index remained below the 50-point reading, which reflects expansion, with subdued demand due to the disruptions caused by the coronavirus disease (COVID-19) seen as the primary reason.

“Lockdown measures continued to hold back travel and leisure, while companies across all main categories of service activity commented on subdued underlying business and consumer spending in the wake of the COVID-19 pandemic,” the report indicated.

The British government announced earlier today that it will end the COVID-19 quarantine for people arriving in England from more than 50 countries, including Germany, France, Spain, and Italy, Reuters reported. However, the decision does not include the US, which saw a record-high number of new cases on Thursday.