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Rapid growth in services sector

ACTIVITY in the Irish services sector rose its sharpest in almost seven years last month.

The latest Purchasing Managers' Index (PMI) for the sector shows the rate of job growth also accelerated.

PMIs are important because they are regarded as reliable forward looking indicators of the health of an economy and are therefore closely watched by investors.

The latest report shows that the rate of expansion in new business quickened for the third month running and was the sharpest since February 2007.

Philip O'Sullivan, economist with specialist bank Investec, said the report shows a strong finish to the year for the services sector.

"Within the data we see much to be optimistic about. The pace of growth in new business quickened for a third successive month during December, with respondents citing strengthening economic conditions and improved client confidence," he said.