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Service sector recovery stutters

Bad and a rise in VAT led to an unexpected slowing in Britain's service sector last month.

The two point fall in the CIPS/Markit services PMI index -- to 54.5 from 56.8 -- contrasted with a sharp rise in the equivalent manufacturing index earlier this week.

"The heavy snow appears to have hit services harder than manufacturing in January," said Paul Smith, senior economist at Markit.

"Whereas manufacturers were often able to make up for lost production days, service providers, especially consumer-facing firms, simply saw fewer customers."

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