Britain’s service sector output increased marginally in February, Brexit concerns have continued to weigh on the economy and hiring of staff has declined to its fastest pace in seven years.
HIS Markit/CIPS purchase managers index (PMI) showed a reading of 51.3 in February, a reading above 50 indicates growth.
Economist’s expectations were forecast to be 49.8, however recent data suggests the economy is almost stagnant, and on track for its weakest quarter since the last three months of 2012.
Financial services firms have held off hiring staff due to the outlook of the economy, and employment numbers declined at a faster rate since 2012.
Chris Williamson, chief business economist at IHS Markit, which compiled the survey said, “The latest PMI surveys indicate that the UK economy remained close to stagnation in February, despite a flurry of activity in many sectors ahead of the UK’s scheduled departure from the EU.
“The data suggest the economy is on course to grow by just 0.1% in the first quarter.
“Worse may be to come when pre-Brexit preparatory activities move into reverse. Many Brexit-related headwinds and uncertainties also look set to linger in coming months even in the case of PM May’s deal going through.
“Business optimism about the year ahead has consequently sunk to the lowest ever recorded by the survey with the exceptions of the height of the global financial crisis and July 2016.”
Howard Archer, chief economic adviser at Item Club said, “There is a genuine chance now that the Bank of England will sit tight on interest rates through 2019, especially if Brexit is delayed and extends the uncertainty.”