UK Private Sector Accelerates Whilst Eurozone Slows

The UK's private sector had been suppressed by Covid related lockdown measures, however, following the lifting of lockdown across most of Britain the sector has expanded at its fastest rate for seven years, seemingly boosted by the release of pent-up demand.

The 'IHS Markit CIPS flash UK composite output index' which measures growth in the sector, rose 60.3 points in August, from 57 points the previous month. Any figure above 50 represents growth.

Manufacturing production led the way after it surged in July to give an index reading of 59.8 but the industry reported that while factories boosted production, output levels remained below pre-coronavirus levels and employment was likely to remain depressed. So, the accelerated expansion appears to be a bounced-back, demonstrating resilience post-lockdown rather than expansion beyond pre-Covid rates.

The US has also experienced rapid expansion of the private sector, however the Eurozone and China have both experienced a slowdown.

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