Services sector growth sees strong bounce in November
The country’s service sector growth bounced back strongly last month from a seven-year low as business confidence rose to its highest level since June amid firmer demand from customers, a survey showed today.
A slowdown in manufacturing activity had threatened to spread in October to the services sector, where a long expansion in new orders weakened to a near standstill.
But new orders rebounded to a three-month high in November.
This sent the AIB IHS Markit Purchasing Managers’ Index (PMI) for services to 53.7 from 50.6, its lowest since July 2012 and close to the 50 mark that separates growth from contraction.
The services sector covers areas as diverse as communication, financial and business services, IT and the tourism trade.
AIB said that panelists reported an increase in orders from existing and new customers in Britain, the US and Latin America.
As a result, the sub-index measuring business expectations rose to a five-month high of 66.4 from 63.3 in October.
While factory activity shrank again last month after a brief reprieve in October, a survey released yesterday showed that consumer sentiment recovered sharply from a seven-year low over the same period as the risk of a damaging no-deal Brexit receded.
“The strong rebound in November is a welcome relief. It suggests the fall (in October) was an aberration and that the Irish services sector is continuing to perform strongly,” AIB’s chief economist Oliver Mangan said.
“The details make for encouraging reading. Activity expanded in all four of the broad service sectors covered in the survey,” he added.
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