In April 2024, the UK services sector recorded a significant growth, achieving its fastest expansion in nearly a year. The S&P Global UK services PMI survey indicated a jump to a score of 55.0 from 53.1 in March, reaching its highest since May of the previous year. This surge in the services sector, encompassing industries such as pubs, restaurants, transport, and financial services, marks a recovery signal for the UK economy, which had previously experienced a shallow recession.

This growth reflects a rise in consumer spending, bolstering sales across these service industries and contributing to a quarterly economic growth rate of 0.4%. Despite this positive trend, businesses reported challenges linked to an increase in the national minimum wage, which tempered hiring rates due to heightened cost pressures.

The future outlook, as gauged by the businesses surveyed, remains optimistic despite potential headwinds from the upcoming general election, interest rates, and global economic uncertainties. There is a broad expectation of continued growth, though firms are cautiously monitoring these variables.

Across the Atlantic, the US economy has demonstrated resilience, with the job market expected to continue its strong performance. Anticipated figures for April suggest a healthy addition of 233,000 jobs, slightly down from March’s 303,000 but still robust. Unemployment is predicted to maintain at 3.8% for the 27th consecutive month under 4%. This enduring strength occurs despite high-interest rates, which have been implemented as part of inflation control measures by the Federal Reserve. Although inflation remains above the Fed’s 2% target, it has been cooling gradually, prompting a cautious stance towards future rate cuts.

Both the UK and US economies show signs of resilience and recovery, navigating through various domestic and global challenges while maintaining a focus on future growth.