Financial services sector shows growth

It now looks likely that the UK economy will avoid a technical recession

The UK financial services sector is continuing to show signs of recovery, according to a new survey, as optimism has improved, business volumes have increased and firms are taking on new staff.

Business volumes were up for the eighth quarter in a row in the first quarter of 2012, according to data from both PricewaterhouseCoopers (PwC) and the Confederation of British Industry (CBI).

A separate survey reported UK finance chiefs were less fearful of a UK recession or a euro break-up than previously.

The news follows growth also being reported in the Manufacturing sector, with further month-on-month increases seen in the closely-watched Purchasing Managers’ Index (PMI).

The CBI’s chief economic adviser, Ian McCafferty, was pleased with the sector’s improving picture but urged caution, “The unexpected rise in employment is a further encouraging sign for the sector.”

“But with the current level of business regarded as below normal, conditions still remain challenging for financial firms.”