Britain's services sector expanded faster than expected last month, a survey showed today, suggesting the economy may be slowing less than previously thought following a year of robust growth. 

The Markit/CIPS services purchasing managers' index (PMI) rose to 58.6 in November after falling sharply to 56.2 in October, beating all forecasts in a Reuters poll.

The decrease came amid reports of firm demand and increased new business. 

The rise in the index was the biggest in over a year, and it has exceeded the 50 level that represents growth for nearly two years. 

A corresponding manufacturing survey on Monday also showed a rebound, though yesterday's construction PMI was weaker. 

Markit said that taken together, the surveys suggested Britain's economy will grow by 0.6% in the final three months of 2014, up from a previous estimate of 0.5%. 

"Faster growth of services activity brings welcome news that fears of a potentially sharp slowdown in the economy look overplayed," said Chris Williamson, chief economist at Markit. 

A composite measure of the services, manufacturing and construction data rose to 57.8 after hitting a 17-month low of 56.4 in October. 

The Bank of England forecasts Britain's economy will grow by 3.5% this year, faster than any other big advanced economy, before growth slows to 2.9% next year. 

Markit said the services PMI showed that falling oil prices, which hit a five-year low yesterday, were helping firms to offset the effect of staff costs as hiring increased at its fastest rate since July. 

"There are also signs that wage growth is picking up alongside the improving labour market, which should help boost household incomes and consumer spending," Williamson said. 

Markit's survey covers services firms across the private sector, apart from retailers. In recent days, a number of surveys have pointed to robustness of Britain's economic recovery. 

Last week official data showed household spending rose at its fastest rate in over four years in the three months to September, while Bank of England data on Monday showed consumers increased their borrowing at the fastest rate since the financial crisis.