Britain’s services sector enjoys a soaring summer with a surge in exports and tourism – dashing fears of post-Brexit recession
Britain witnessed the biggest rise in monthly activity since current records began in 1996
BRITAIN’S vital services sector enjoyed a soaraway summer – dashing fears of a post-Brexit recession.
A surge in exports and tourism in August sparked the biggest rise in monthly activity since current records began in 1996, figures reveal.
Markit’s figures sent the Pound to $1.3375, its highest level against the dollar for nearly seven weeks.
And economists ripped up doom-laden predictions of a deep recession.
The services sector — which includes everything from restaurants to financial services — generates around three-quarters of Britain’s economic output.
It came as separate figures yesterday revealed car sales rose by 3.3 per cent in August as the Brexit vote failed to deter buyers.
Former Justice Secretary and Brexit champion Michael Gove said the rally had left doom-mongering International Monetary Fund boss Christine Lagarde with “oeuf on her face”.
The Tory said: “Does this not confirm that 17 million people who voted to leave know a darn sight more about economics than the so-called experts?”
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Brexit Secretary David Davis replied: “Much of the doom and gloom and fear mongering has been proven to be wrong.”
The figures come a week after consultant Markit’s figures showed Britain’s manufacturing was on a march with the highest activity level for ten months.
Cynics said at the time the services sector data would provide a far better reading of the health of the economy.
Markit said its services Activity Index jumped from 47.4 to 52.9 in August after a flood of new business.
Economists warned the size of the bounce back was in part down to the slide in activity in July as firms cut back after the Leave vote.
Markit expert Chris Williamson added: “It is too early to say whether August’s upturn is the start of a sustained post-shock recovery. But anecdotal evidence indicates the shock of the vote has begun to dissipate.”
The Bank of England is still likely to cut interest rates to 0.1 per cent in November. Scott Bowman, of Capital Economics, warned economic growth for the third quarter could be zero.