UK Services Sector Hit By Election and Consumer Squeeze

Britain’s services grew more slowly than expected last month as businesses put off investment decisions before this week’s national election and higher inflation squeezed households, a survey showed on Monday.

The British economy looks as if it has recovered some of its momentum after slowing in the first three months of 2017, when the cost of the pound’s fall after last year’s Brexit vote caught up with consumers.

But financial data company IHS Markit, which conducted the survey, said May’s weak performance by services increased the risks that quarterly growth in the overall economy might not hit its forecast of 0.5 percent.

Reuters

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.