The Irish services sector expanded at its fastest rate in three months in May, a new study has shown, with the area having not experienced a contraction in almost three years.
Investec’s monthly Services Purchasing Managers’ Index increased to 61.4 in May compared to 60.6 in April.
A reading above 50 denotes expansion, while any reading below that level signals contraction. May’s reading stretches to the period that the sector has been in growth to 34 consecutive months, with the index not having dropped below 50 since since July 2012.
The sector was aided by the weakness of the euro against sterling and the US dollar which has allowed some increases in output prices while maintaining competitiveness, helping profits to rise during the three month period to May.
Investec Ireland’s chief economist Philip O’Sullivan said: “According to respondents, improving economic conditions was a key factor behind the latest rise in activity, enabling companies to secure greater levels of new business.
“More than three times as many panellists reported a rise in activity during May compared to those who experienced a fall.
Within the report, we see that demand is on the rise both at home and abroad.