British service sector activity eased more than expected in January as new business growth slowed, a survey showed on today.
The Chartered Institute of Purchasing and Supply/RBS service sector business activity index eased to 57 in January from December's 20-month high of 57.9 and came in below the 57.5 analysts had expected.
Most of the survey's sub-indices slipped back from highs hit in December 2005 but remained well above the 50 mark that separates growth from contraction.
Economists said the figures showed the economy was growing at a reasonable rate and supported expectations the Bank of England will leave interest rates on hold at 4.5 per cent when it meets next week and perhaps for several months to come.
Although the survey does not include the retail sector, analysts said the figures painted a broadly optimistic picture for the British economy.
"Should consumer services start to reinvigorate as anecdotal evidence suggests, the outlook for the sector as a whole should improve substantially. The data is very much consistent with the Bank staying on hold next week," said Gavin Redknap, economist at Standard Chartered.
A separate survey of the 12-member euro zone showed growth there accelerated to a two-year high, boosted by a strong performance from Germany and rising business confidence.