Services firms boost recovery hopes

The UK’s recovery hopes have been given an unexpected boost after optimism among services firms showed a record leap in January and job creation hit a four-year high.

The Markit/CIPS survey, where a reading above 50 indicates growth, showed activity in the services sector rose to a ten-month peak of 56, up from 54 in December. It was the third month of improvement in a row.

January saw the greatest jump in business expectations in the survey’s 15-year history, as sentiment was boosted by a marked acceleration in improved activity and new business wins.

Employment levels saw their strongest growth since March 2008, as companies took on extra staff to deal with new work and to reduce backlogs.

And there was more good news as cost inflation eased to its lowest in 14 months.