| Consensus | Consensus Range | Actual | Previous | |
| Composite Index | 49.8 | 49.1 to 50.5 | 49.4 | 48.5 |
| Manufacturing Index | 53.5 | 53.4 to 53.5 | 53.1 | 53.7 |
| Services Index | 50.0 | 49.0 to 50.1 | 48.7 | 47.9 |
Highlights
The UK private sector remained under pressure in June, with the composite PMI declining to 49.4 from 49.7 in May, marking a 14-month low and signalling a second consecutive month of contraction. The weakness was driven primarily by the services sector, where the business activity index fell to 48.7, its lowest level in 41 months, as elevated costs, geopolitical tensions in the Middle East and domestic political uncertainty weighed on business confidence and consumer demand. Manufacturing continued to provide a temporary cushion, with output supported by strategic stockpiling ahead of anticipated price increases, although the sector's headline PMI eased to 53.1 and new order growth slowed to a six-month low.
The report suggests that the UK economy is experiencing a demand-driven slowdown alongside persistent cost pressures. Total new business fell at the fastest pace in 14 months, backlogs declined sharply and firms continued to reduce employment, particularly in services, indicating weakening underlying momentum. Inflationary pressures moderated for a second consecutive month, but input costs remained historically elevated due to higher energy, commodity, shipping and labour costs, while supply chain disruptions persisted. Although business expectations improved modestly, optimism remains constrained by geopolitical uncertainty and fragile consumer spending.
In summary, the latest data and report points to an economy balancing easing inflation against deteriorating demand, leaving growth prospects subdued despite the resilience of manufacturing activity. These latest updates take the RPI to minus 21 and the RPI-P to 0, meaning that economic activities are now well behind market expectations in the UK.
Market Consensus Before Announcement
Composite expected at 49.8 in the June flash versus 49.7 in the May final. Manufacturing stays strong, expected at 53.5 versus 53.9 and services at 50.0 versus 49.3.
Definition
The flash Composite Purchasing Managers’ Index (PMI) provides an early estimate of current private sector business activity by combining information obtained from surveys of the manufacturing and service sectors of the economy, around 650 companies in each case. The flash data are released around ten days ahead of the final report and are typically based upon around 75-85 percent of the full survey sample. Results covering a range of variables including manufacturing output, employment, new orders, backlogs and prices are synthesised into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) activity versus the previous month and the closer to 100 (zero) the faster is activity growing (contracting). The report also contains flash estimates of the manufacturing and services PMIs. The survey is produced by S&P Global.
Description
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' surveys, investors will know what the economic backdrop is for the various markets. The flash PMIs are particularly closely watched as they provide a wide ranging look at economic developments and some of the most up to date information available. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.