Wednesday 17 January 2018

Service firms more optimistic as export orders grow again


John Mulligan

Business confidence at Irish firms in the services sector was tempered during June but continued growth in new export orders has provided further optimism that the country is benefiting from improved competitiveness and a better global economic environment.

NCB's monthly purchasing managers' index (PMI), released yesterday, also showed that while there was a reduction in the number of new orders registered by Irish companies last month, the services sector posted an overall faster pace of growth than in May.

The data -- which excludes retail and wholesale sectors -- revealed that the index of business activity in the Irish services sector stood at 52.4 in June compared with 50.5 in May. Any figure above 50 indicates expansion while below 50 demonstrates contraction.

That rise in activity masked a second successive reduction in total new business, however. The overall index of new orders stood at 49.4 in June. Although new orders decreased, the rate of decline was only marginal and slower than that seen in the previous month.

The business confidence rating fell to 60.3 compared with 62.3 in May, while employment in the services sector fell in June at what was described as a "modest" pace by NCB. Employment in the sector has fallen in 39 of the previous 40 months.

NCB chief economist Brian Devine said that "fragile consumer confidence" in Ireland had hit the level of new business recorded by the 600 firms that take part in the monthly survey.

Irish Independent

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