Caution required from latest PMI survey

The latest PMI survey of the UK economy clocked a figure consistent with recession. Many commentators are now indeed predicting an imminent downturn, with Q3 GDP set to fall they say.

I would urge great caution. This survey has regularly given false readings of recessions in the past because of the way it is compiled. We need also to see if this is not just reflecting some kind of kneejerk panic as we initially saw reflected in the financial markets. Moreover the Bank of England survey of agents report was much more sanguine. We do really need to see concrete data before making any conclusions.

Finally, the reading suggests nothing like that seen in 2009 after the global financing crisis.