Ireland: Services PMI rises notably in March returning to expansionary terrain
The AIB services sector Purchasing Managers’ Index (PMI) rose to 54.6 in March from 41.2 in February. As a result, the index landed comfortably above the 50-threshold that separates contraction from expansion in business activity and logging the best results in eight months.
March’s upturn was largely driven by expanding business activity and new work, amid a spur in domestic demand. Moreover, exports bounced back for the first time since February 2020, chiefly owing to higher external demand from the U.S., EU and supported by UK business resumption. In light of the growing workload, firms increased their staffing levels for the second time in 13 months and service providers’ sentiment hit a 33-month high, on expectations of higher activity in the 12 coming months. On the inflation front, rising price pressures stemming from fuel, shipping, insurance, wages, raw materials and Brexit-associated costs pushed inflation to the highest rate since February 2020, prompting firms to hike their selling prices.