Commenting on the S&P Global Flash UK PMI data for March 2026, Jake Finney, Senior Economist at PwC, says:
“After a strong start to the year, UK private sector growth slowed considerably in March as events in the Middle East clouded the economic outlook. Demand has weakened, cost pressures have picked up, and the pace of job cuts has accelerated.
“This presents a conundrum for the Bank of England. The conflict is pushing up prices while also weighing on demand. The key judgement for Monetary Policy Committee members will be how long the conflict is likely to last and whether higher energy prices will trigger a broader resurgence in inflation pressures. With the labour market now softer than it was at the start of the 2022 inflation spike, the risk of second-round effects is lower. Even so, the prospect of near-term rate cuts has all but faded.”
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