London, UK: Pubs, hotels and restaurants experienced the fastest fall in output of any UK sector, according to Lloyds Bank UK Recovery Tracker.
Output in the tourism and recreation sector, which includes pubs, contracted at the fastest pace since February 2021, the tracker reported.
The drop was caused by demand falling for a fourth consecutive month – to a tracker score of 38.5 last month – as consumers reined in spending amid rising inflation.
The tracker showed that overall input cost inflation for businesses intensified in September for the first time since May. The increase was driven by rising energy prices for manufacturers, which exceeded a previous peak during the 2008 oil price shock.
Jeavon Lolay, the head of economics and market insight for commercial banking at Lloyds, said: “While we expect UK inflation to remain stubbornly high in the coming months, there are clear signs of an easing in pipeline cost pressures in our latest UK Sector Tracker report.”
Between the second and third quarters this year, the average pace of input cost inflation slowed in all 14 sectors monitored by the tracker. This was supported by easing wage and shipping cost pressures – with reports of higher shipping costs reaching a 21-month low in September. The pace of inflation in prices charged to customers slowed in 12 sectors.
In September, the UK sectors recording output growth were: Household products (50.6), healthcare (53.6), industrial goods (50.4), technology equipment (50.7) and software services (55.8).
The UK Sector Tracker is an evolution of the Lloyds Bank UK Recovery Tracker. It uses PMI data from S&P Global to shed light on current trends in the UK economy.
