UK Composite PMI Surges to Four-Month High, Dashing Rate Cut Bets

The UK's economic growth accelerated in August, surpassing forecasts and suggesting a resilient economy despite headwinds. The S&P Global Composite PMI rose to 52.5, its highest level in four months, driven primarily by strong services sector activity.

New orders increased at a faster pace, and employment rose for the first time in three months, providing some relief from input cost inflation, which eased to a three-year low.

The stronger-than-expected PMI reading reduces the likelihood of an imminent interest rate cut by the Bank of England, with markets having priced in a 25-basis-point cut by November. The pound strengthened against the dollar and euro following the release, reflecting investor confidence in the UK economy.