The report suggested new business growth slowed last month with new exports also stalling. Economist Chris Williamson at IHS Markit, published the services sector PMI figures – a measure of manufacturing trends, said it was becoming increasingly likely Britain was “slipping into recession”. He said: “Business activity in the service sector almost stalled in August as Brexit-related worries escalated, curbing spending by both businesses and consumers.
“So far this year the services economy has reported its worst performance since 2008, with worrying weakness seen across sectors such as transport, financial services, hotels and restaurants, and business-to-business services.”
However, by 11am today Investing.com was reporting the figures were back above 50 percent and said: “A reading above fifty suggests the service sector is expanding.”
Since the 2016 referendum economists predicting Brexit doom and gloom have repeatedly got it wrong.
Straight after the referendum investment bank JP Morgan predicted Scotland will leave the UK and get a new currency. Scotland is still part of the UK and uses the pound.
Goldman Sachs (which donated £500,000 to the Remain campaign) predicted the UK would be in recession by 2017. In fact economic growth actually accelerated to 1.4 percent.
And the Treasury itself predicted 500,000 job losses – in fact the UK is enjoying unprecedented levels of employment.
However Mr Williamson added: “So far this year the services economy has reported its worst performance since 2008, with worrying weakness seen across sectors such as transport, financial services, hotels and restaurants, and business-to-business services.
“After surveys indicated that both manufacturing and construction remained in deep downturns in August, the lack of any meaningful growth in the service sector raises the likelihood that the UK economy is slipping into recession.
“The PMI surveys are so far indicating a 0.1% contraction of GDP in the third quarter.
“While the current downturn remains only mild overall, the summer’s malaise could intensify as we move into autumn.
“Companies have grown increasingly gloomy about the outlook due to the political situation and uncertainty surrounding Brexit, adding to downside risks in coming months.
He said morale was at its lowest since the economic crisis and said the “gloomier outlook” had also led to a slowdown in job growth.
Economist Duncan Brock of the Chartered Institute of Procurement & Supply also said he was worried about the PMI numbers, which are based on interviews with British purchasing managers.