April’s services Markit/CIPS report (09.30 BST) should provide reassurance that last week’s disappointing first estimate of GDP is not indicative of the recovery’s true strength. March’s survey suggested that the sector’s recovery was in fine fettle, with the business activity index picking up from 56.7 to 58.9, its highest level since August 2014. Capital Economics says – “We see no reason why the business activity index is likely to fall back in April after March’s pick-up. Accordingly, we have pencilled in a further rise in the business activity index to 59.5 in April.”At 59.9 in March, the survey’s total orders balance was consistent with another strong reading. In addition, the recent demand and overall confidence indices of the EC Economic Sentiment survey both picked up in April.
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