Crunching all the PMI data into a big economic hash, this means that quarterly GDP is up 0.5%, says Chris Williamson, chief economist at Markit. So pop your corks and whoop for joy, we’ve avoided recession. The upshot of this growth (albeit tentative) is that the UK economy has more than offset the 0.3% decline in the past quarter, taking us off the road to ruin and onto the road to recovery.
Looking at the PMI services data in depth, record numbers of jobs were created last month; the highest level in four years. And business leaders operating in the industry are bullish in their plans for growth over the next 12 months. Optimism is back in town.
The money men over at the Bank of England will be feeling pretty cheerful too. There will be no more asset purchases for now, and no more quantitative easing either. Liquidity in the markets is nice and stable.
We’re not totally out of the woods, however. The Diamond Jubilee is set to dampen GDP growth and there’s a strong chance that, unless business activity picks up further, the economy could contract again in the second quarter. But things could be a hell of a lot worse.