Although business activity in the sector rose, it did so at its slowest rate in over half a year, with hotels, restaurants and leisure providers reporting the greatest slowdown.
The numbers will do little to reassure Sterling investors and come shortly after it was revealed that car sales had slowed again on the month.
Although October’s car sales registered a 2.9 percent fall, it was nothing like as bad as the previous month’s “carmageddon” which showed a 20 percent plunge, and had been blamed on tougher European emissions tests introduced over the summer.
Despite the weaker services and car sales figures, markets don’t appear particularly perturbed by the data and the pound has risen by around 0.3 percent against the euro since.
Instead, GBP/EUR traders have chosen to focus on the drama surrounding Italy’s budget impasse, with the Italian Deputy PM Luigi Di Maio causing a furore by saying that his plans for ramping up spending and cutting taxes could be copied by other countries in Europe.
Mr Di Maio, who is leader of the Five Star Movement, said the austerity-busting plans would help get rid of austerity and provide a boost to Italy’s anaemic economy, telling the Financial Times: “If the recipe works here, it will be said at a European level: we should apply the recipe of Italy to all other countries.”
His suggestion has not gone down well with euro investors who are worried that Italy’s budget deadlock could cause contagion across the bloc, especially if other countries copy Italy’s example in flouting EC rules.
Looking ahead, euro investors will be focused on Germany from tomorrow as we get a look at how the country’s industrial sector and factory orders fared in September.
This should give markets an idea of how the Eurozone’s powerhouse economy third quarter GDP figures will look when they come out next week.