UK Private Sector Growth Reaches Six-Month High

The UK's private sector is experiencing a modest growth, with the S&P Global composite purchasing managers' index (PMI) rising to 52 in March, the highest level in six months. While this increase is seen as a positive sign, economists caution that it does not indicate a full economic recovery. The service sector reported strong activity, yet manufacturing is under pressure, hitting its lowest confidence levels since late 2022, primarily due to export weaknesses and global uncertainty. Concerns about upcoming tax increases and labor costs are contributing to a bearish short-term outlook for manufacturing, while the services sector remains more optimistic. The overall economic sentiment continues to be fragile, with business confidence affected by geopolitical risks and inflation pressures. Analysts suggest that the Bank of England may remain cautious in adjusting interest rates due to these mixed signals.