UK Composite PMI Hits 53.1 in October, Strongest Since February on New Orders and AI Demand

British business activity reached its strongest level since February in October, with the S&P Global UK Composite Purchasing Managers' Index rising to 53.1 from September's 52.0, beating all forecasts in a Reuters poll of economists. Companies added workers for the first time since hiring was depressed by a tax increase in former finance minister Rachel Reeves' 2024 budget. Manufacturers posted their strongest output increase in more than two years, while services firms reported accelerating new orders. S&P Global said some firms cited a sales boost from AI investment spending. Price pressures remained strong, with business cost inflation the sharpest since June, especially among manufacturers. Chris Williamson, chief business economist at S&P Global Market Intelligence, said the data make a Bank of England rate hike at its upcoming meeting "a near certainty" and likely shorten the odds of further hikes into 2027. The BoE is expected to raise rates on November 5 for the first time in more than three years.