Business

‘Economy almost grinding to a halt’: UK private sector growth falls to its weakest point since last winter’s lockdown

UK private sector growth is the weakest it has been since last year’s winter lockdown, as the cost of living crisis hits consumer demand.

The closely-watched S&P Global / CIPS Flash UK Purchasing Managers Index (PMI) hit 51.8 in May – a 15-month low and down from 58.2 in April.

Anything above 50 is considered growth.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said: “The UK PMI survey data signal a severe slowing in the rate of economic growth in May, with forward-looking indicators hinting that worse is to come.

“Meanwhile, the inflation picture has worsened as the rate of increase of companies’ costs hit yet another all-time high.

“The survey data therefore point to the economy almost grinding to a halt as inflationary pressure rises to unprecedented levels.

“The tailwind from the reopening of the economy has faded, having been overcome by headwinds of soaring prices, supply delays, labour shortages and increasingly gloomy prospects.

“Companies cite increasingly cautious moods among households and business customers, linked to the cost-of-living crisis, Brexit, rising interest rates, China’s lockdowns and the war in Ukraine.”

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