‘Sluggish' UK business activity picks up as tariff threat eases
The strengthening service industry helped offset a persistent slump in manufacturing in June.
The S&P Global flash UK composite purchasing managers' index (PMI) reported a reading of 50.7 in June, up from 50.3 in May.
The flash figures are based on preliminary data. Any score above 50.0 indicates that activity is growing while any score below means it is contracting.
The volume of new business returned to growth in June, ending a six-month period of contraction, the survey found.
This was primarily driven by the service sector – the largest part of the UK's economy, spanning industries including hospitality, entertainment and culture, finance and real estate.
A further slight expansion of activity in the sector was contrasted by another drop in production for manufacturers, led by a decline in overseas export orders.
Concerns over the impact of Donald Trump's tariffs on US imports were partly behind the slump, despite some businesses saying confidence had improved as a result of the President striking new trade deals with countries including the UK.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said the UK economy was in a 'sluggish state' in recent weeks.
'Although business conditions have continued to improve since April's downturn, quelling recession fears, growth of business activity remains disappointingly lacklustre, indicative of second quarter GDP (gross domestic product) rising at only a 0.1% quarterly pace,' he said.
'Business confidence also remains in the doldrums compared to this time last year, losing ground again in June.
'On top of concerns over the impact of recent government policies and worries over global trade protectionism, June's data collection coincided with increased tensions in the Middle East.
'Employment has hence continued to be cut as firms grapple with the combination of higher staffing costs, linked to last autumn's budget, lower demand and subdued confidence.'
The survey showed that hiring continued to be squeezed throughout the month, with employment across the private sector decreasing for the ninth month in a row and at a faster pace than May.
Businesses surveyed said they had been making cutbacks to their workforce through hiring freezes and redundancies.
But Elliott Jordan-Doak, senior UK economist for Pantheon Macroeconomics, pointed out that 'businesses were more optimistic about the future in June than in May, suggesting the economic outlook is improving'.
'Domestic activity is proving more resilient than external demand, consistent with Mr Trump's tariff threats weighing on cross-border trade,' he added.
'All told, the PMI suggests that business confidence is staging a fragile recovery after being battered by tariff threats and tax increases.
'That said, rising geopolitical stress is likely to be added to the growing list of worries facing businesses.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily Mirror
21 minutes ago
- Daily Mirror
'I compared £160 mango from Harrods to M&S version and one had me floored'
A woman decided to put the viral £160 mango from Harrods' foodhall to the test as she compared it to a mango she'd bought from Marks & Spencer - put people say it wasn't a 'fair' comparison While prices at the supermarkets continue to rise, many shoppers have become skilled at finding the best deals and cheapest prices for their groceries. However there are still some who won't bat an eyelid at spending hundreds of pounds extra for the quality of their food. People visiting luxury department store Harrods in central London might have noticed the high prices of food in the store's famous food hall, where you can find thing such as fresh meats, seafood, fruit and veg, baked goods, cheese, or meals ready to go. However, you will quickly noticed that the price tags of these items are higher than if you'd were to go to Tesco or Lidl. But this doesn't stop people from purchasing the items, as the higher prices often make people wonder if the products are 'better' than what you can find in different stores. This was the case for Laura Khoshaba, who often heads to Harrods to try their expensive food products to determine whether or not they're worth the luxury price tag. She recently made a video where she tried a Japanese mango she'd bought from the food hall for a whopping £160 as she wanted to see how it compared to a mango from Marks & Spencer's food hall. "I'm going to be comparing the £160 mango from Harrods to a mango from M&S," she said at the start of her video. As she cut the two mangos open, you can clearly see a difference as the mango from Harrods looks a lot juicer and has a bright orange colour instead of the yellow colour like the one from M&S. Holding up the mango from M&S, she said: "This is very dry, like, and quite hard as well." It was then time for the taste test. As she tasted the mango from Marks and Spencer, you could hear the crispiness of the fruit as she took a bite and chewed. "No," the woman next to her said after trying the mango. Laura then said: "It's dry." "Very, very, very dry," the other woman agreed. Laura then went on to explain that they'd left the mango at home for a few days to ripen even more since they bought it from the store. They also showed the skin of the mango, which they said felt and looked ripe. "It's not ripe. It's just a dry mango," the woman who was off-camera said. They then moved on to the Mango from Harrods. Having cut it into cubes, Laura went on to press the back of the mango so that the flesh poked out in the same way she'd done for the previous mango. She commented: "Look at the difference." As she took a bite of the mango, she quickly shook her head as a big smile came across her face while she chewed. She then said: "This is the best mango I've ever had in my life." "It's just unreal," the other woman agreed. Laura added: "I just can't get over how soft it is. You don't have to chew it." The other woman exclaimed: "I don't think I've ever had fruit as tasty as this mango." As she simply removed one of the cut up cubes from the skin, she commented: "A perfect square. You just pick it off. We won't be wasting any of this." People soon took to the comments of the video to share their thoughts, with some saying it wasn't a fair comparison. One viewer pointed out: "They are two completely different mango variants so it's not a fair test. Like the above comments, try the Indian or Pakistani Honey mangoes and see the taste difference compared to Harrods. Will be identical for a fraction of the cost." A second person echoed: "Two very different mango types at different stages of ripeness. Like comparing a banana and plantain." While a third person also wrote: "There's many types of mango. In Brazil Mango Tommy is juicy, manga Rosa is delicious. Pakistani mangos are just another level." Another person couldn't believe the price as they wrote: "Is it really true that Harrod's would charge £160 for a mango? It's not even £160 per kg?"
NBC News
25 minutes ago
- NBC News
Oil prices show muted gains as world awaits Iranian response to U.S. strikes
U.S. benchmark oil prices were only marginally higher Monday morning, an outcome that reflects investors shifting into wait-and-see mode as they take stock of Iran's response to U.S. strikes on its nuclear facilities. The 0.2% gain in West Texas Intermediate crude futures, to less than $74 a barrel, reflected a significant overnight pullback from the nearly 4% spike seen Sunday evening when trading of commodities futures opened. Stocks opened flat. The current oil price is still the highest since late January — but is only slightly below the overall average seen since 2023. It would equate to gasoline prices of about $3.30 a gallon, assuming oil prices stay at these levels. That would be a big assumption. Wall Street analysts say that by ordering the strikes, President Donald Trump has once again injected massive uncertainty into markets after having already done so with his on-again, off-again tariff announcements. 'There is in our view a wide range of outcomes for oil prices in the next few weeks,' analysts with UBS financial group wrote in a note to clients. 'The nature and extent of Iranian retaliation remains the key parameter.' If the Iranian response somehow stays muted, oil prices could actually fall back down, the analysts said. But the U.S. strikes have likely increased the risk to disruptions of energy infrastructure in the Middle East, they wrote. If any such disruption were to occur, oil prices would surge in the short term. "EVERYONE, KEEP OIL PRICES DOWN. I'M WATCHING! YOU'RE PLAYING RIGHT INTO THE HANDS OF THE ENEMY. DON'T DO IT!" Trump posted to social media Monday morning. The biggest focus remains on whether Iran will limit or cut-off access to the Strait of Hormuz, a chokepoint in the Persian Gulf through which about one-fifth of the world's oil supply travels. Iran's state-owned media reported that Iran's parliament backed closing the strait — but that the final decision lies with Iran's national security council, according to the report. There was no word yet that such an order had been given. UBS said it sees a disruption of the strait as 'low probability' at this point. An early-morning report that six tankers had begun moving away from the strait was updated just before 9 a.m. to show that three of the vessels had reversed course and were heading back to the strait. 'The strait is critical for Iran's own exports as its terminal outside of the Strait only has limited capacity,' the analysts said. 'A closure would also have a material negative impact for several other countries such as Qatar and China and would likely present a challenge for Iran.' Analysts with ING financial group outlined four possible avenues for Iran: full escalation that also draws in other nations such as China or Russia; disruption of the Strait of Hormuz; active or passive support for terrorist attacks in the U.S. and Europe; or taking no action at all. 'We will abstain from speculating about the next steps and instead conclude that the most likely economic consequences from the US strikes will be on general uncertainty and on the price of oil,' the ING analysts wrote.
Daily Mirror
32 minutes ago
- Daily Mirror
M&S shoppers go wild for £13 liqueur flavour that's the 'taste of summer'
High street favourite Marks and Spencer's 'divine' new product, which costs £13, has got many shoppers excited and keen to try it - especially as the summer temperatures continue to soar Marks and Spencer's new summer beverage has got many shoppers excited and keen to try it, especially as the summer heatwave gets underway. Making the most of the warmer weather often sees people stocking up on fresh, zesty treats that'll keep them cool while they relax in the sunshine. Iconic British retailer M&S is a staple on the high street after its humble origin as a market stall which was founded in Leeds back in 1884. Today, it maintains its relevancy and allure thanks to a wide range of departments spanning on-trend fashion, stylish homeware, homeware, lingerie, beauty products and more. The company's beloved Food Halls are equally adept at pulling in customers. There, shoppers can peruse high quality in-house products as well as a selection of branded food and drink, too. Like many of its high street competitors, Marks and Spencer optimises social media to maintain a connection with fans, keeping them in the loop on all the newest product launches and releases. The retailer boasts millions of followers across a range of Instagram pages, each focused on a specific department. Recently, M&S cross-posted a video to its main account and its food account to showcase its new Limoncello Liqueur. In the footage, the beverage was used to create an Italian-inspired summer cocktail. Captioning the clip, M&S penned: 'Lemon drop it like it's hot! Serve yourself up a sip of the Amalfi coast with this gorgeous Limoncello Lemon Drop cocktail, made with our brand-new deliciously citrusy Limoncello liqueur. 'Made with Italian lemon peels to give you that gorgeous flavour of the Mediterranean coast, this luscious liqueur can also be enjoyed neat over ice or makes a great addition to sparkling wine'. In the comments section, people were keen to share their thoughts on the beverage. One person said: 'I could just drink this right now'. Another confessed: 'Onto my second' while a third said: 'Sounds absolutely divine'. Someone else commented: 'Sunshine in a glass? Don't mind if we do! This is officially our new summer obsession'. While a further shopper said: 'Gosh this would just be ideal for the heatwave this weekend!' And another tagged a friend and wrote: 'They actually had this yesterday when I was in. Will have to get a bottle'. Someone else also tagged a friend and added: 'This is a bit of you'. Marks and Spencer's Limoncello Liqueur, which is suitable for vegans, costs £13 for a 50cl bottle. It's made with water, sugar, alcohol, natural lemon flavouring, natural flavourings, and a lemon peel infusion of alcohol and lemon peel. It can be purchased via Ocado, or in person at an M&S store.
