THE monthly services index, a new indicator from the Central Statistics Office, was unveiled yesterday.
The index increased by 0.6pc in March from the previous month and 4pc from the same month last year, the CSO said as it published results for the first time. David McNamara, an economist with Davy stockbrokers, said the estimate of monthly output in the services sector could become an important indicator in time.
The services index will give an up-to-date snapshot of the economy along with retail sales and industrial production indices, he added.
Industrial production figures can be volatile in Ireland because of the influence of the multinational sector, but the services index is likely to give a clearer picture because it draws data from a large range of firms.
In the UK, the monthly services index is used to derive quarterly GDP numbers and is therefore a useful tool in forecasting GDP movements with greater certainty.
The CSO reported yesterday that the services sector with the fastest monthly growth was the transportation and storage sector. Accommodation and food service also saw growth along with the wholesale and retail trade and business services. Service sectors which saw contraction included the information and communications sector.
On an annual basis, information and communication posted the strongest gains followed by transportation and storage along with wholesale and retail trade.
Business services along with accommodation and food service activities posted declines.
Provisional quarterly data shows that the non-industrial services sector increased by 1.8pc compared with the final quarter of 2011 and by 3.8pc from the first quarter of 2011.
The CSO is revamping the statistics it collates to bring them into line with the rest of Europe.
It has only recently started publishing quarterly GDP figures at the request of Eurostat and plans to introduce further figures in future.
The Cork-based statistics office said yesterday that the purpose of the monthly services index is to measure changes in current price output in the non-financial traded services sector. It is the first step in the development of a services production index which will measure volume change in the sector.