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Ireland PMI March 2020

Ireland: Services PMI plummets amid coronavirus outbreak

The AIB service sector Purchasing Managers’ Index (PMI) nosedived to 32.5 in March from 59.9 in February, highlighting that business activity in the services sector was severely hit by the economic fallout from the coronavirus outbreak. Thus, the index fell well below the critical 50-threshold that separates expansion from contraction in business activity and marked the lowest reading since April 2009.

March’s downturn was broad-based. Both business activity and new business contracted at the fastest rate in over a decade as international demand collapsed, while the transport and tourism sectors suffered the sharpest declines. As a result, Irish service providers cut staff for the first time in over seven-and-a-half years and the rate of job shedding was the quickest in over eight years. On the price front, input price inflation slowed markedly in March amid lower fuel prices, while firms lowered output charges for the first time in six years as they tried to boost sales.

Meanwhile, the 12-month outlook deteriorated significantly in March, and the sub-index fell to the weakest level since the survey began in May 2000 (and was therefore even lower than during the Global Financial Crisis of 2008) amid firms’ heightened fears over the long-term economic impact of the Covid-19 pandemic.

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