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Irish Services Growth Hits Highest During Pandemic: PMI

By Donna Ahern
Irish Services Growth Hits Highest During Pandemic: PMI

A surge in new orders from home and abroad spurred the sharpest rate of growth in Irish services activity since the COVID-19 pandemic began in March, while most of the sector remained in lockdown, a business survey showed on Wednesday.

Ireland shut most building sites, shops and the hospitality sector from late December. The government hopes to reopen all shops in May and hotels in June in a very gradual easing of restrictions.

Business expectations among services firms nevertheless hit a 33-month high as the AIB IHS Markit Purchasing Managers' Index (PMI) jumped to 54.6 from 41.2 in February, crossing the 50-mark separating expansion from contraction for the fourth time since February 2020.

'New Business' 

The increase was driven by a similarly sharp rise in new business. Exports rose for the first time since February 2020 as firms reported stronger sales to the United States and Europe, and the resumption of UK business following a pause at the start of 2021.

"This pick-up in new business resulted in a rise in the volume of outstanding work and saw employment expand for only the second time since the start of the pandemic," AIB chief economist Oliver Mangan said.

"This signals improved business conditions in the sector rather than activity returning to more normal levels (as) ... much of the sector remains in lockdown."

The mood and performance of Irish services firms were much closer to neighbouring Britain than the rest of the eurozone.

Flash readings last month showed that services activity in Britain hit a seven-month high of 56.6 as it prepared for an easing of lockdown restrictions, while the eurozone average stood at 48.8 as another virus wave hits parts of mainland Europe hard.

News by Reuters edited by Donna Ahern, Checkout. Click subscribe to sign up for the Checkout print edition.

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