LONDON (Reuters) – Britain’s services firms have started 2024 on a strong footing, with a strong influx of new orders and the pace of hiring at the highest in six months, the prospect of lower interest rates encouraging demand, the S&P Global Services PMI survey for Britain showed on Monday.

The index for the services sector rose from 53.4 in December to 54.3 in January, its highest level since May 2023, and following a preliminary estimate of 53.8.

“New orders have rebounded this winter, as the risk of a recession diminishes, while financial conditions ease and encourage spending,” notes Tim Moore, economic director of S&P Global Market Intelligence.

The composite PMI, which combines the services and manufacturing sectors, hit a record high of 52.9 in January, up from 52.1 in December.

Monday’s PMI survey showed that wages remained a significant factor driving costs, acting as a partial drag on hiring, but that total costs were rising at the slowest pace in three years.

Prices charged to customers rose at the slowest rate in four months, although the rise remains significant in absolute terms.

“The slowdown in producer price inflation reflects falling energy and fuel costs, as well as falling commodity prices,” notes Tim Moore.

(Written by David Milliken, Corentin Chappron, edited by Kate Entringer)

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