Service sector mood soured by Brexit despite strong growth

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Service sector mood soured by Brexit despite strong growth


Deal doubts: Brexit supporters in London – the exact nature of the deal still hangs in the balance. Photo: PA
Deal doubts: Brexit supporters in London – the exact nature of the deal still hangs in the balance. Photo: PA

Business confidence among services sector managers has fallen to its lowest level since 2013 due to uncertainty around Brexit.

AIB Services Purchasing Managers Index (PMI) found just under four in 10 panellists were confident their business will improve over the coming 12 months, despite continued strong growth.

While business activity continued to expand, the pace of activity in March including new order growth eased from February. Export sales expanded at the weakest pace in over two years. Overall the PMI – an indicator designed to provide a single-figure measure of the health of the services industry – posted 55.3 last month, down from 55.9 in February. Any reading over 50 is deemed growth, therefore the data still signalled a monthly increase in activity.

Meanwhile, the pace of job creation accelerated from February, with businesses saying that they added staff in order to fulfil customer demand.

On the price front, the rate of input cost inflation moderated to a four-month low.

“Overall, the PMI reading of 55.3 for March suggests that the Irish economy is continuing to expand at an impressive pace,” said AIB chief economist Oliver Mangan.

“However, the readings for the opening three months of the year are all below the levels seen in 2018. This indicates that growth in the economy has slowed somewhat from the very robust rate seen in recent years.”

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Irish Independent

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