Worst services figures since foot and mouth increases fears of double-dip recession

Worst services figures since foot and mouth increases fears of double-dip recession By Hugo Duncan Last updated at 10:07 PM on 5th September 2011 Global growth ground to a halt last month as output in Britain’s powerhouse sector slowed the most for more than a decade.Weak figures from the UK, Europe,  China and India fuelled fears that the global economy is heading for a double-dip recession.It followed last week’s news of a sharp slowdown in factory output around the world in August and dismal American  jobs figures. ‘The US and Europe are clearly vulnerable,’ said Michala Marcussen,  head of global economics at French bank Société Générale. The closely-watched Markit/CIPS index of activity in the services sector – where anything whoesale prada shoes above 50 represented growth – dropped from 55.4 in July to 51.1 in August, the biggest fall in the index since April 2001, when foot and mouth disease hit agriculture and tourism. The sector is the driving force of the British economy, accounting for three-quarters of GDP. Richard Driver, an analyst at currency experts Caxton FX, said: ‘Without robust growth in the key services sector, a UK recession seems highly likely. ‘The public disorder we saw in August will have hurt the services sector to a degree, but this should not blur the fact that the UK economy is quite clearly stalling.’ Markit chief economist Chris Williamson added the index of activity across the economy – including manufacturing, construction and services – fell sharply from 54.3 in July to 50.9 last month. He said it signalled ‘a near stagnation of economic growth in August’ and warned that the country faced a weak third cheap jeans quarter before ‘contraction’ in the fourth. The slowdown could force the Bank of England to print more money to kick-start the recovery.