UK Business Activity Rises Less than Expected

2026-09-23 08:46 By Andre Joaquim 1 min. read

The S&P Global UK Composite PMI eased to 51.7 in September of 2026 from 52.5 in the previous month, slightly under market expectations of 52, according to a flash estimate.

Still, the result marked a third month of expansion in British private sector activity after the surge in prices from the war in Iran triggered back-to-back contractions in May.

Activity eased both for the services sector (51.7 vs 52.5 in August) and manufacturing (51.4 vs 52.1).

Service providers noted that geopolitical uncertainty in the Middle East constrained orders, pressuring aggregate UK orders to ease, and contrasting with support from technology services.

In turn, a group of manufacturers had sales supported by AI investment and defense spending.

Meanwhile, employment fell for two straight years with firms still citing National Insurance costs.

Also, input cost inflation hit a three-month high on widespread subsector increases, led by labor and fuel.

Despite the headwinds, business optimism was unchanged.



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UK Business Activity Rises Less than Expected
The S&P Global UK Composite PMI eased to 51.7 in September of 2026 from 52.5 in the previous month, slightly under market expectations of 52, according to a flash estimate. Still, the result marked a third month of expansion in British private sector activity after the surge in prices from the war in Iran triggered back-to-back contractions in May. Activity eased both for the services sector (51.7 vs 52.5 in August) and manufacturing (51.4 vs 52.1). Service providers noted that geopolitical uncertainty in the Middle East constrained orders, pressuring aggregate UK orders to ease, and contrasting with support from technology services. In turn, a group of manufacturers had sales supported by AI investment and defense spending. Meanwhile, employment fell for two straight years with firms still citing National Insurance costs. Also, input cost inflation hit a three-month high on widespread subsector increases, led by labor and fuel. Despite the headwinds, business optimism was unchanged.
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The S&P Global UK Composite PMI rose to 52.5 in August from 52.2 in the previous month, firmly above market expectations that it would ease to 51.6, according to a flash estimate. The growth was bolstered by fresh traction for the services providing sector (52.8 vs 52.1 in July), which offset a slowdown in the manufacturing sector (51.2 vs 52.9). New orders at the aggregate level improved to the most since February, before the war in the Middle East started, driven by resilience in services. Still, staffing numbers dropped further to approach nearly two years of consecutive monthly declines, with employers continuing to cite surging labor costs due to new National Insurance contributions. Input costs for the private sector accelerated due to high fuel prices and wages, driving output charge inflation to rebound. Looking ahead, business expectations at the aggregate improved for a third month on improving margins since energy prices peaked in June.
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