PwC comments on S&P Global UK PMI data - December 2025

Commenting on the S&P Global Flash UK PMI data for December 2025, Jake Finney, Senior Economist at PwC, says:

“The latest PMI shows a strong rebound in business activity as the fog from the Budget clears. It reinforces our view that the weakness in recent GDP and PMI readings was driven more by elevated Budget-related uncertainty than by a structural collapse in underlying activity. Although the Chancellor set out a tighter fiscal stance, firms seem reassured that the drag on demand will be less severe than feared, helped by most of the tightening being pushed down the line.

“The one caveat is that job losses remain widespread, and it is unclear whether hiring will pick up now that Budget-related uncertainty has faded. Renewed cost pressures are clearly feeding through into more cautious hiring decisions. This will be a concern for Bank of England rate-setters, particularly with selling price inflation picking up across both goods and services.

“Ultimately, this data should take some of the heat out of fears of an imminent quarterly contraction, but the best we can reasonably hope for Q4 is weak or flat growth. The Government will be looking for a repeat of the pattern seen in recent years, with momentum rebuilding early in the new year. A Bank of England rate cut on Thursday, as widely expected, would give sentiment another lift and reinforce the sense that conditions are moving in the right direction.”