U.K. October services PMI shows upside surprise

U.K. services headline PMI for October posted more than expectation, coming in at 54.9, up by 1.6 points from 53.3 in September. The headline index for the country rose for the first time since June, recovering after a disappointing reading in August and September; however, the forward-looking categories nonetheless provide a more cautious view. 

New business growth in the economy was remained unchanged at a two and a half year low of 55.0, having been in continued decline since March 2015, and is now approaching its long-term average. Business expectations fell to their lowest level since December 2012, printing at 68.0, just below their long-term average. 

Additionally, cost pressures remained muted as prices charged fell to 50.7 and input prices edged lower to 53.2 (-0.1 and -0.9 points, respectively). Outstanding business edged up marginally to 50.8, while employment continued its upward trend, registering a 0.6pp rise to a five month high of 56.1, notes Barclays.