UK business activity slumped to a 13-month low in November, as companies gave a “thumbs down” to Labour’s Budget, according to a closely watched survey. The composite PMI index, a measure of the health of the UK’s manufacturing and services sectors, slid below the 50 mark, signifying that most groups are now reporting worsening conditions. After the release of the data, which came on the heels of disappointing retail figures, the pound fell 0.6 per cent against the dollar to $1.
Last month’s Budget, which also included an increase to the national living wage, strained Labour’s relations with groups in sectors including retailing and hospitality, despite pledges from Reeves to work closely with business and lead Britain’s most “pro-growth” Treasury. Elias Hilmer, economist at the consultancy Capital Economics, said the drop in PMIs suggested that GDP could now be shrinking after barely growing in the third quarter.