UK PMI Services was finalized at 54.0 in January, surging from December’s 51.4 and marking the strongest reading since August 2025. PMI Composite also rose sharply to 53.7 from 51.4, the highest level since August 2024,.
According to Tim Moore of S&P Global Market Intelligence, the survey points to an “encouraging start” to the year after a sluggish end to 2025. Service sector output expanded at the fastest pace in five months, supported by improved investment sentiment and stronger inflows of new work. That said, Moore noted that consumer demand remains constrained by squeezed household incomes, while geopolitical risks continue to weigh on business spending decisions.
The recovery is therefore uneven. While business confidence improved to its highest level since October 2024, firms continued to cut staff at an accelerated pace as they sought to offset rising payroll costs. At the same time, a sharp increase in input prices fed through to the fastest rise in output charges in five months.
