Consumers have less to spend due to the rising cost of living and this - along with businesses trying to limit spending due to inflation - has squeezed demand.
The UK's service sector has grown at its slowest rate since February last year - when much of the country was still under COVID-19 restrictions.Anything above 50 is positive so it means the sector - which accounts for 80% of UK GDP - was still growing, but more slowly than the 53.3 analysts had expected.
It comes as the Bank of England is expected to raise interest rates on Thursday, as it seeks to bring inflation down from 40-year highs. That inflation is playing a big role in the cost-of-living crisis currently gripping most UK households, and those behind the PMI report said this was having a knock-on effect on the services sector, which is also facing increasing bills.Tim Moore, economics director at S&P Global Market Intelligence, said:"Reduced levels of discretionary consumer spending and efforts by businesses to contain expenses due to escalating inflation have combined to squeeze demand.
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