It was a close call, but all the signs are that the UK has managed to avoid the dreaded triple-dip recession – phew.
The anticipated services Purchasing Managers Index (PMI) survey from Markit and the Chartered Institute of Purchasing & Supply (CIPS) shows that business activity in the service sector has grown at the strongest rate since last May.
A rise in the main Markit/CIPS PMI for the dominant service sector to 52.4 in March, from 51.8 in February, represents the highest reading since the business-boosting London Olympics last August.
Business confidence is also at a ten-month high following a reported improvement in confidence and willingness to commit to new contacts. The data showed 47% of the businesses surveyed anticipating higher activity.
Growth in new business has been recorded for three months in succession, and at increasingly strong rates.
UK service providers responded to rising sales levels by adding to their payroll numbers for a third month in a row during March.
There were also reports that employment had increased in anticipation of further sales wins in the coming months - but the net rise in payroll numbers was marginal.
Chris Williamson, chief economist at Markit, said: “The government and Bank of England will breathe sighs of relief in seeing signs of a gathering upturn in the service sector during March, which looks set to have helped the UK avoid a triple-dip recession by the narrowest of margins.
“Business activity grew in March at the fastest rate since the Olympics-related upturn seen last August, providing a much needed boost to the economy in the first quarter after disappointing surveys for the smaller manufacturing and construction sectors. “
David Noble, chief executive officer at the CIPS, added: “It seems that the service sector has finally found the ingredients, which if mixed correctly, may well result in the right recipe for sustained growth in 2013.”
Let’s hope it’s a cake worth eating…