Strongest rise in UK business activity in a year while hiring falls; WH Smith shares crash 40% on accounting error –as it happened

Government borrowing falls to 1.1bn in July as tax receipts rise, but chancellor remains under pressure

Things are also looking up in the eurozone, where new orders increased for the first time in 15 months in August, helping lift business activity.

Companies also increased their staffing levels for the sixth month running. Meanwhile, inflationary pressures strengthened, with both input costs and output prices rising at sharper rates in August.

Things are getting better. Economic activity has picked up in both manufacturing and services. Overall, we've seen a slight acceleration in growth over the past three months. Despite headwinds like US tariffs and general uncertainty, businesses across the eurozone seem to be coping reasonably well. The EU Single Market is likely playing a helpful role here, especially since most export and tourism revenues are generated within the EU.

The European Central Bank might wince a little at the rising cost pressures in the services sector. After all, it's banking on slower wage growth to help bring inflation down in this crucial part of the economy. That said, there's a bit of relief in the fact that inflation in service-sector selling prices has remained more or less steady.

Foreign orders in the eurozone manufacturing sector have declined for the second month in a row. Germany had been holding up well, possibly due to pre-emptive purchases from the US, but now it's also seeing a drop in orders. France has climbed out of the deep hole of falling foreign demand over the last months, but incoming orders are still on the decline.