Activity in Britain's services sector grew in August at the fastest rate for almost two years, according to data released by the Chartered Institute of Purchasing ansd Supply (CIPS).

The CIPS/Markit services purchasing managers index rose to 54.1 from 53.2 in July, raising hopes that the UK will exit recession in the third quarter of this year.

The rise came from solid gains in new businesses and backlogs falling at a faster pace than expected.