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Growth in services sector picks up amid uplift in new work

By August 4, 2022No Comments

Growth in the country’s services sector picked up in July, amid a sharp uplift in new work.

The AIB Services PMI rose to 56.3 last month, from 55.6 in June, though this was still below the May reading of 60.2.

Readings above 50 indicate overall growth in activity.

By comparison, the flash July Services PMI in the euro zone fell to 50.6, while the UK index dropped to 53.3 and the US to 47.

The Irish data shows that growth was broad-based across the four monitored sectors in July.

The financial services sector registered the strongest rate of expansion.

However, there was a loss of momentum in the technology, media and telecoms sector during the month.

Despite this, Oliver Mangan, AIB’s chief economist, said business confidence for this sub-sector, as measured by the future activity index, hit a three-month high, as it did in the services sector as a whole.

The latest figures show that the rate of cost inflation cooled further in July from recent peaks, though remained elevated.

As a result, firms continued to hike their charges, with the pace of inflation matching April’s survey peak.

“Firms continued to experience severe upward pressure on input prices, in particular, fuel, materials and labour costs and also indicated that unfavourable exchange rate movements were adding to inflation,” Mr Mangan said.

Underpinning the overall improvement in performance in July was another uplift in new business inflows to Irish services firms

The report states that improved client demand, both domestically and abroad, drove the latest rise.

New business growth was strongest in Financial Services and weakest in Transport, Tourism & Leisure.

Meanwhile, companies in the sector continued to raise their workforce numbers in July, reportedly linked to higher workloads and a strong pipeline of new business.

Article Source: Growth in services sector picks up amid uplift in new work – Gill Stedman – RTE

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