The UK service sector showed a continued upturn in business activity in September, although domestic demand was subdued.
However, the rate of expansion edged up only slightly on August’s figures and remained weaker than the average for the first half of the year.
The seasonally adjusted IHS Markit/CIPS Services purchasing managers’ index (PMI) stood at 53.6 in September, up from an 11-month low of 53.2 in August.
Growth in the third quarter as a whole eased slightly on the previous quarter, with a level of 53.5 in Q3 compared with 54.3 in Q2.
Subdued domestic demand acted as a drag on growth, with September’s rise in new work the slowest increase for 13 months.
Survey respondents reported resilient consumer spending and a healthy labour market, but said concerns about the business outlook were acting as a brake on growth.
Service providers cited subdued business-to-business sales and delayed decision-making on large projects as a result of Brexit-related uncertainty.
Firms also reported a decline in optimism on growth for the year ahead, with the number of respondents expecting a rise in business activity over the next 12 months at its lowest level since June.