UK Preliminary Services PMI jumps to 52.7 in December vs. 51.0 expected

• UK Manufacturing PMI fell to 46.4 in December, missing estimates of 47.5.
• Services PMI in the UK jumped to 52.7 in December, a big beat.
• GBP/USD regains upside traction despite mixed UK business PMIs.

The seasonally adjusted S&P Global/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) dropped to 46.4 in December versus the 47.5 expected and, 47.2 - November’s final print.

Meanwhile, the Preliminary UK Services Business Activity Index jumped to a six-month high of 52.7 in December, compared with the 50.9 final print for November and the 51.0 market forecast.

Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said: “The UK economy continues to dodge recession, with growth picking up some momentum at the end of the year to suggest that GDP stagnated over the fourth quarter as a whole.”

“While employment meanwhile fell for a fourth month, the decline was only marginal and not indicative of any material rise in unemployment,” Chris added.

FX implications

At the press time, GBP/USD is paring back gains to trade near 1.2755, having spiked to 1.2775 in a knee-jerk reaction to the upbeat UK data. The pair is trading modestly flat on the day.