Investing.com – The service sector in the U.K. fell more-than-expected in December, contracting for the first time since April 2009, data showed on Thursday.
In a report, market research group Markit said the seasonally adjusted Markit/CIPS Services Purchasing Managers Index fell to 49.7 in December, down from 53.0 in November.
Analysts had expected the index to decline to 52.9 in December.
On the index, a level above 50.0 indicates expansion in the industry, below 50.0 indicates contraction.
According to the data, the U.K. service sector contracted in December due to poor weather conditions, ending a 16-month period of growth.
Commenting on the report, Chris Williamson, chief economist at Markit said, “Bad weather undoubtedly hit service sector business in December, but there are also clear signs that domestic demand has weakened as households and business continued to reign in their spending.”
He added, “Expectations regarding business activity in the coming 12 months remain at a level which tends to be associated with economic crises and falling activity.”
Following the release of that data, the pound was down against the U.S. dollar, with GBP/USD shedding 0.14% to hit 1.5493.
Meanwhile, European stock markets were up. The FTSE 100 gained 0.36%, the EURO STOXX 50 rose 0.38%, France’s CAC 40 added 0.44%, and Germany's DAX was up 0.45%.
In a report, market research group Markit said the seasonally adjusted Markit/CIPS Services Purchasing Managers Index fell to 49.7 in December, down from 53.0 in November.
Analysts had expected the index to decline to 52.9 in December.
On the index, a level above 50.0 indicates expansion in the industry, below 50.0 indicates contraction.
According to the data, the U.K. service sector contracted in December due to poor weather conditions, ending a 16-month period of growth.
Commenting on the report, Chris Williamson, chief economist at Markit said, “Bad weather undoubtedly hit service sector business in December, but there are also clear signs that domestic demand has weakened as households and business continued to reign in their spending.”
He added, “Expectations regarding business activity in the coming 12 months remain at a level which tends to be associated with economic crises and falling activity.”
Following the release of that data, the pound was down against the U.S. dollar, with GBP/USD shedding 0.14% to hit 1.5493.
Meanwhile, European stock markets were up. The FTSE 100 gained 0.36%, the EURO STOXX 50 rose 0.38%, France’s CAC 40 added 0.44%, and Germany's DAX was up 0.45%.