THE region's service sector companies continued to grow last month but the rate of expansion slowed, a survey said today.

The Chartered Institute of Purchasing and Supply's (CIPS) survey of the UK service sector showed firms reporting further growth of demand in June but showed a drop from May and the rate of expansion had eased to a five-month low.

The slower growth was blamed mainly on higher interest rates and the weakness of the manufacturing sector.

These concerns fed through to companies' confidence -- the survey showed service sector companies were less confident in June about their business prospects for the coming year.