• UK Manufacturing PMI dropped to 44.7 in December, a big miss.
• Services PMI in the UK comes in at 50.0 in December, beating estimates.
• GBP/USD remains heavily offered near 1.2140 on mixed UK PMIs.

The seasonally adjusted S&P Global/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) dropped further to 44.7 in December versus 46.3 expected and 46.5 – in November’s final reading.

Meanwhile, the Preliminary UK Services Business Activity Index for December arrived at 50.00 when compared to November’s final print of 48.8 and 48.5 expected.

Chris Williamson, Chief Business Economist at S&P Global, commented on the survey

“The December data add to the likelihood that the UK is in recession, with the PMI indicating a 0.3% GDP contraction in the fourth quarter after the 0.2% decline seen in the three months to September.”

“For now, the downturn looks to be relatively mild, and the easing in the rate of decline in December is encouraging news, as is the further marked cooling of inflationary pressures.”

FX implications

Mixed UK Services PMI fails to move the GBP/USD pair. The spot is trading at 1.2140, down 0.29% on the day.