Wednesday 13 December 2017

Irish services growth falls back in August from nine-year high

Irish services sector PMI growth slowed last month
Irish services sector PMI growth slowed last month

Padraic Halpin

Growth in Ireland's services sector fell in August from July's nine-year high as the pace of new business slowed after expanding at its fastest in a decade and a half in the previous month, new figures have shown.

After surging by more than 5pc in 2014, Ireland's economy is set to be the fastest growing in Europe again this year. Data last week showed retail sales volumes rose by almost 10pc year-on-year in July.

The Investec Purchasing Managers' Index of activity in services, which covers businesses from banks to hotels, fell to 62.1 from 63.4 in July and has stayed above the 50-point line separating growth from contraction for over three years.

While overall new business fell back from July, when it recorded the third-highest mark since the series began in 2000, the rate of expansion remained strong.

New export orders increased at a faster pace during the month, with the rate of growth sharpest since January while the rate of job creation quickened for the second month running in August and was one of the fastest in the series history. 

"With close to 20 times as many firms indicating that they expect to see a rise in activity over the coming year compared to those predicting a decrease, it is clear that most services firms are positive on the outlook for the sector," Investec Ireland chief economist Philip O'Sullivan said.

"Given the improving signs emanating from most of Ireland's key trading partners and the upturn in the domestic economy, we share this optimism."


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