Economic Buzz: UK private sector output regains momentum in October

The UK private sector economy regained some momentum in October, with stronger output growth underpinned by another modest upturn in the service economy and the first expansion of manufacturing production for 12 months. New business volumes also increased in October, which contributed to the least marked rate of private sector job shedding since May.

At the same time, input price pressures moderated to the lowest since November 2024. This led to a slower rate of output charge inflation, driven by a weaker uplift in service sector prices.

Adjusted for seasonal factors, the headline S&P Global Flash UK PMI Composite Output Index registered 51.1 in October, up from 50.1 in September and above the 50.0 no-change value for the sixth consecutive month.

Output growth remained relatively sluggish in the service economy, with the latest expansion the second-weakest since May.

Manufacturers recorded the fastest upturn in production since September 2024, although the rate of growth was only marginal overall.

Total new business across the UK private sector returned to growth in October, led by improving sales pipelines in the service economy. Falling export sales persisted, however, largely reflecting another steep reduction in the manufacturing sector.

Lower overall input cost inflation and efforts to stimulate sales through competitive pricing contributed to a slower rise in average output charges across the private sector economy in October.

Business activity expectations for the year ahead meanwhile improved during the latest survey period and were the second-highest since October 2024.

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