The UK's services sector expanded at its slowest rate for three months during May, offering more signs today of pressure on the UK economic recovery.
With consumer spending power weakened by inflation and low wage growth, today's Markit/CIPS survey, where a reading of above 50 indicates growth, showed activity slowed to 53.8 in May from 54.3 the previous month.
The run of bank holidays in April is likely to have caused some lost momentum, but economists said the findings added to the largely disappointing news on the UK economy in recent days.
Earlier this week, the same survey covering the manufacturing sector showed a drop in production and new orders for the first time since June and July 2009 respectively. While not as bad as the industrial figures, analysts said the latest deterioration in the services sector 'provided further evidence that the economic recovery is still struggling'.
The figures have also reinforced expectations that interest rates will be kept at a record low of 0.5% when the Bank of England's monetary policy committee meets next week.
