London, United Kingdom (4E) – Growth in the UK services sector maintained its pace in September, resulting to the industry’s strongest quarter in 16 years with a rise in confidence and employment.
The Markit and the Chartered Institute of Chartered Surveyors services purchasing managers index (PMI) barely changed in September, easing to 60.3 in September from 60.5 in the previous month, as new business confidence grew.
In September, new business at service companies expanded, while sentiment improved and payrolls climbed at a solid pace, Markit said.
Despite a series of positive indicators on the UK economy, the Bank of England (BoE) said they will stay committed to keep borrowing costs low for long enough to support the fledgling rebound. BOE Governor Mark Carney reiterated this message in a televised interview Wednesday.
Keeping interest rates low until the jobless rate drops to 7 percent or below should boost business investment. This, in turn, will help job creation and earnings growth as well as spur in consumer spending and confidence.
Chris Williamson, chief economist at Markit, said that Thursday’s figures indicate the central bank’s accommodative policy is providing the economy more boost than previously anticipated.
The gauge of UK construction dropped to 58.9 from a record-high 59.1 in August, Markit said. The manufacturing index was down to 56.7 from 57.1, the highest level in two and a half years.