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.
Author: Hanna Andersson, Economist