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Irish service providers record weakest activity growth in a year

Irish service providers record weakest activity growth in a year

Irish : Growth in business activity among Irish service providers slowed in December for the third consecutive month and was the weakest since November 2017, according to a survey.

However, the latest IHS Markit Ireland Services PMI also shows the rate of expansion in new orders ticked up and was sharp.

Cost inflation quickened to the fastest in four months, driven by rises in fuel, utility and insurance bills and higher staff costs. In contrast, the rate of charge inflation softened.

The headline seasonally adjusted Business Activity Index posted 56.3 in December, down from 57.1 in November. A score above 50 represents growth whereas a score below 50 represents contraction.

The survey also showed that activity growth among Irish service providers remained solid and was faster than the series average.

At the sector level, technology, media and telecoms (TMT) companies registered the fastest rise in business activity.

New order growth quickened in December as service providers said they had seen greater customer interest in their services.

TMT companies posted the sharpest rise of all monitored sectors. New export business also expanded at a faster pace in December as firms saw an overall pick-up of international demand, especially from the UK.

On the employment front, service providers continued to create jobs at a sharp rate. The latest rise in employment was at the same pace as that seen in November. All four sectors saw staffing levels increase, led by TMT.

The level of outstanding business increased further, but the rate of backlog accumulation weakened to its slowest in 27 months as the sharp increase in headcounts enabled firms to make some headway through their work-in-hand.

Elsewhere, Italy’s services sector expanded at its fastest pace in three months in December, signalling a possible acceleration in growth during the first part of 2019.