Ireland: Services PMI rises in September
October 3, 2018
The Investec service Purchasing Managers’ Index (PMI) rose to 58.7 points in September, up from 58.0 points in August. The index remained further above the critical 50-point threshold that separates expansion from contraction in the sector, where it has been for more than five years. September’s print indicates a slight improvement in business conditions in the Irish services sector.
Activity in the service sector accelerated on the back of a strong expansion in new orders. Output growth rose to a three-month high, while new business continued on a sharp ascent during September. New export orders climbed at a swifter rate, with some firms especially highlighting new business from U.K. customers. Consequently, backlogs of work increased at a solid pace, although the rate eased from the previous month and was the slowest since August 2017. Firms raised their payroll numbers to deal with the higher workloads, at a pace not seen since the end of last year. On the price front, input prices rose on higher wages and an upturn in fuel costs. Service providers increased their output charges accordingly. Business sentiment improved slightly on expectations of a further rise in new business and more buoyant economic conditions.
Author: Nihad Ahmed, Economist