Ireland PMI August 2020

Ireland

Ireland: Services PMI rises in August, hinting at continued recovery

September 3, 2020

The AIB services sector Purchasing Managers’ Index (PMI) rose to 52.4 in August, from 51.9 in July. As such, the index climbed further above the 50-threshold that separates expansion from contraction in business activity, suggesting that the recovery is taking hold.

August’s upturn was mainly driven by a pick-up in activity as new business increased for the first time in six months. Despite this, businesses continued to cut employment, although the rate of job shedding slowed for the fourth month running. On the price front, input costs rose fort the second consecutive month and at a quicker clip than in the previous month, largely reflecting higher transport and coronavirus-related costs. Meanwhile, output charges fell for the sixth month straight owing to weak client demand. Lastly, although the outlook for the year ahead was optimistic in August, sentiment slipped somewhat from the previous month and remained historically subdued.

FocusEconomics Consensus Forecast panelists project fixed investment to contract 6.7% in 2020, which is up 3.6 percentage points from last month’s forecast. For 2021, the panel sees fixed investment growing at 1.2%.


Author:, Economist

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Ireland Services PMI August 20 20 0

Note: Investec Services PMI. Readings above 50 indicate an overall increase in business activity compared to the previous month, and below 50 an overall decrease.
Source: AIB and IHS Markit.


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