In response, GBPUSD dropped back but then recovered some of its losses as traders reasoned that higher input costs could lead to rising inflation and therefore a more hawkish outlook for monetary policy and the Pound.
The sub-index for new export business, which dipped marginally into negative territory in November, recorded its second successive monthly increase, helped by stronger demand from the UK. There was also some evidence that increased costs were discouraging companies from increasing staffing levels. That will add to concerns that rising inflation is eroding household budgets and will hit consumer spending, a key driver of the United Kingdom economy.
Composite 55.5 vs 56.0 exp.
Despite the weaker outcome, service providers' expectations over activity in 12 months time was the strongest since May last year and the equal-highest for a year-and-a-half.
Nintendo returns to quarterly operating profit but cuts full-year outlook
Nintendo sold 196,000 units in the U.S.at a price of $60 during November, researcher NPD reported last month. Probably the most unlucky console from Nintendo , the Wii U, has officially ended its production in Japan.
"Faster growth of new business and an upturn in confidence about the year ahead to the highest since the region's debt crisis bodes well", said Chris Williamson, chief business economist at IHS Markit. "Only construction companies stepped up their hiring at the start of 2017".
A senior Bank of England official yesterday said the election of Donald Trump has boosted financial markets around the world - giving the United Kingdom economy a lift.
Cost pressures in services firms remained elevated in January according to the latest survey, with inflation rising to the highest rate seen since March 2011. However, the rate of job creation slowed to a five-month low.
The economy's growth of 0.6 per cent in both the third and fourth quarters of 2016 has defied widespread predictions of a slowdown and possible recession in the wake of the UK's vote to leave the European Union. It therefore covers about half the economy, whereas official data on services published with more of a lag covers nearly 80%.