Ireland: Services PMI hits over five-year high in June
The AIB services sector Purchasing Managers’ Index (PMI) rose to 63.1 in June, coming in above May’s 62.1 and logging the highest reading since January 2016. As a result, the index moved further above the 50-threshold that separates expansion from contraction in business activity.
June’s upturn was chiefly driven by a solid rise in new business, as the lifting of lockdown restrictions spurred demand, with the transport, tourism and leisure sectors logging the biggest gains. Similarly, new export orders expanded again, albeit at a softer pace. This, resulted in a peak in outstanding work, which was somewhat eased by marked growth in employment levels—the job creation rate was the sharpest since September 2017. On the price front, higher charges for fuel, utilities, wages, insurance and freight, as well as Brexit-associated costs pushed input cost inflation to a near 13-year high. As a result, firms hiked their selling prices markedly to protect their profit margins.