The upturn in positive data for the British economy continued on Monday, with record-breaking service sector Purchasing Managers'Index (PMI) figures.

But how sustainable is this recovery?

George Buckley, chief UK economist with Deutsche Bank, told Xinhua, "This raises the big question not whether we have reached escape velocity as the governor of the Bank of England (BOE) has been describing, but whether we have escape sustainability. We have certainly got the speed it is whether it can be sustained."

Activity in the dominant services sector spiked in July to its highest level since the end of 2006. The composite PMIs for all three sectors jumped to a record high of 59.8 in July from 56.6 in June and 54.9 in May.

Buckley said, "We have gone from the situation where we asking 'will we ever get growth back again' to one where we are saying is it sustainable."

He said that the British economy had been at this point before, in the first two quarters of 2010, when there was growth of almost one percent quarter-on-quarter, but that was not sustained.

"Would something come along to derail the recovery again? Whether it requires the BOE to do more Quantitative Easing (QE) is an uncertain question," said Buckley

The BOE probably think they do need to do more, in the shape of guidance, said Buckley, which is likely to be announced on Wednesday.

Buckley said the strength of current figures had led him to up his forecast for growth, but he believed the strength of growth would weaken over time.

Buckley has upped his growth forecast to 1 percent in Q3, then going down to 0.6 percent in Q4 and then back down to 0.4 percent in Q1 2014.

"That reflects the fact that I am not convinced about sustainability," he said.

James Knightley, chief economist at ING said, "The PMIs add to the evidence that the British economy is gaining momentum and therefore there is little need for any further direct stimulus in the form of rate cuts or QE."

Knightley said the agenda at the BOE would now be about maintaining the current accommodative monetary policy environment to ensure the recovery continues.

"The BOE clearly wants to limit upward market pressure on borrowing costs and sterling by guiding market, business and household expectations on the likely path of interest rate policy," said Knightley.

He said he believed the BOE would opt for time-related guidance over specific data targets in the future.

Howard Archer, chief UK and European economist at IHS Global Insight, said, "The fact that the recent improvement has occurred across a wide range of sectors is particularly encouraging and reinforces hopes that the British economy really is establishing a firmer footing."

Archer said he had also revised upwards his forecast for growth, up to 1.3 percent for 2013 (up from 1.1 percent), and to 1.9 percent for 2014 (up from 1.8 percent). This marks the third successive month that IHS has revised its forecasts upwards.

Global Times