UK services sector data has just boosted hopes for a rebound

Jessica Morris
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Data shows the economy rebounded at the start of the second quarter (Source: Getty)

The last data released before the polls open tomorrow has shown services growth hit an eight-month high, potentially allaying fears the economy is slowing after the release of disappointing first quarter GDP figures.

The Markit/CIPS UK Services Business Activity Index rose for a second month in April to 59.5, up from 58.9. A reading above 50 signals increased activity on the previous month, while below this mark implies contraction.

This was primarily driven by a rise in new business received by service sector companies, which increased for the 28th month straight in April.

The news may quell fears after disappointing growth figures published at the end of last month, which showed the economy grew just 0.3 per cent in the first three months of 2015, missing expectations of 0.5 per cent. The services sector - whose growth is usually encouraging - grew just 0.5 per cent during the period.

"The PMI surveys suggest the economy is showing robust growth momentum, expanding at a rate of 0.8 per cent at the start of the second quarter," Chris Williamson, chief economist at Markit, said.

"As such it looks like the economy has rebounded from the weakness seen at the start of the year."

Naeem Aslam, chief market analyst at Avatrade, added that the figure was "good news for Mr Cameron".

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