UK April PMI Indicates Higher Cost Pressures, Says Capital Economics

On April 23, Jin10 reported that Capital Economics noted the preliminary PMI survey for April in the UK indicates higher-than-expected cost pressures faced by businesses. This aligns with the Consumer Price Index (CPI) peaking at approximately 5.0%. According to Jin10, the PMI data suggests stronger-than-expected economic performance, with the composite PMI rising to 52.0 in April from 50.3 in March. This may cause some Bank of England policymakers to be more concerned about the risks of high inflation rather than the risks of slowing economic growth. However, the strong PMI might reflect pre-war momentum and stockpiling behavior, suggesting that future economic activity could still weaken.