Ireland: Services PMI drops in October
November 4, 2015
The Investec Services Purchasing Managers’ Index (PMI) dropped from September’s 62.4 to 60.1 in October. Despite the drop, the index remains comfortably above the 50-threshold that indicates expansion in the services sector and marks the 39 consecutive month of growth in the sector.
October’s reading mainly reflects a moderation in the rate of growth of new orders, which can be attributed to a deterioration in the global economic outlook. Total new orders grew at a slightly slower pace than in the previous month and new export orders eased in October. Backlogs of work increased in October and employment continued to rise, recording a 10-month high. Input cost inflation increased again in October, mainly resulting from higher wages and salaries, and output prices continued to increase as a result.
According to the survey report, “while this implies the slowest rate of expansion since February 2014, the latest increase is still much quicker than the series average […] It is clear that most services firms are bullish on the outlook. While noting that the risks have increased in recent months, we share our panelists’ view of favorable prospects for the Irish services sector.”