January data pointed to a slowdown in growth of services activity across the UK, which stemmed from relatively weak gains in new work. Job creation nonetheless picked up as companies retained positive expectations surrounding the outlook. Although the latest results revealed an easing of inflationary pressures, rates of increase in both input costs and output charges remained above their long-run trends.

Falling from 54.2 in December to 53.0 at the start of the year, the seasonally adjusted IHS Markit/CIPS UK Services PMI Business Activity Index indicated the slowest upturn in services output for 16 months. Growth was reportedly curtailed by the loss of existing clients and lingering concerns surrounding the UK's exit from the EU. Nonetheless, panellists mentioned that sustained rises in sales, acquisitions and new offerings underpinned output expansion.