(Alliance News) - The UK service economy had its best performance in six months in December, a strong end to the year which helped boost the wider private sector, numbers on Thursday showed.

The final S&P Global UK services business activity index climbed to 53.4 points in December from 50.9 in November.

This was above the 50.0 no-change mark for the second month running and above the earlier flash estimate of 52.7

"December data indicated that the UK service sector ended last year on a high, with business activity growth accelerating to its fastest for six months as the turnaround in order books gained momentum," said S&P Global Market Intelligence Economics Director Tim Moore.

"The recovery in client demand was attributed to hopes of lower borrowing costs and an improving global economic backdrop in 2024. However, many firms continued to cite challenging underlying business conditions due to the stagnating UK economy and strong pressure on margins from rising labour costs."

The final seasonally adjusted S&P Global UK composite purchasing managers' index registered 52.1 points in December, up from 50.7 in November and above the neutral 50.0 value for the second month running.

This beat last month's flash estimate for December of 51.7 points and marked the highest final reading since June.

The composite reading is a weighted average of the services and earlier manufacturing reading. On Tuesday, numbers showed the manufacturing PMI fell to 46.2 points in December, having risen to a seven-month high of 47.2 in November. The PMI fell further below the 50-point no-change mark, remaining below the threshold for the 17th consecutive month.

The services PMI is compiled by S&P Global from responses to surveys sent out to around 650 service sector companies in the UK, while the composite PMI is the weighted average of both the services and manufacturing PMIs. Responses are collected in the second half of the month.

By Greg Rosenvinge, Alliance News senior reporter

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