Monday 21 May 2018

Services sector shrinks again

ACTIVITY in the services sector of the economy shrank in January for the second month in a row, despite a rise in new export orders, a report has shown.

NCB Services Purchasing Managers' Index recorded 48.3, down from 48.4 in December. Any figure below 50 means that activity fell.

NCB economist Brian Devine said the most notable reading in the report was the employment index, which fell from 47.3 to 44.5, the sharpest fall since April 2010.

Some 24pc of companies lowered their staffing levels, while only 9pc raised them.

New orders contracted again, but only marginally, with this part of the index recording 49.7. However, new export orders rose, with this index climbing to 52.8 from 52.1. Confidence among services companies rebounded from December's 13-month low, recording 63.6. The rate of cost inflation accelerated in January to 55, mainly due to higher fuel costs and a fall in the euro's value.

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