The U.K services PMI fell in July, plunging both services output and new business at fastest rates since March 2009, according to Markit Economics.
Services Purchasing Manager fell from 52.3 in June to 47.4 in July, signalling a contraction of the U.K services output. This is the first slowdown in business activities since December 2012 and the strongest rate of decline in six years.
On a monthly basis, business activities decline at 4.9 points, its largest since the survey started in 1996.
The number of incoming new businesses also fell for the first time in four years, confirming analysts report that the British exit from the European Union had weighed on new business inflows during the month of July.
Even without a financial recession, the U.k.economy faces a period of lacklustre growth, said Dean Turner, an economist at UBS Wealth Management.
“Off the back of equally disappointing manufacturing figures, today’s numbers confirm that the UK economy is slowing. Although not currently our base case, if current levels for the PMIs are sustained, we may need to brace ourselves for a mild recession by the end of the year,” Dean added.
