Irish services industry activity expands for first time in 27 months
Business activity in the Irish services sector rose slightly in April, ending a 26-month sequence of contraction.
The NCB Services PMI for April was at 51, up from 49.6 in March. Readings above 50 signal an increase in activity on the previous month.
Strong optimism was again recorded at Irish service providers, and improved for the second month running amid signs of economic recovery.
While higher new business was the main factor driving activity growth, panellists reported that economic conditions remained fragile, however.
New orders rose marginally in April. New business had previously decreased in each month since February 2008. There were reports that heavy discounting had been required, however.
The rate of growth in new export orders was more marked than that seen for overall new business, and the steepest since October 2007. The UK was the main source of rising new export orders.
Despite the tentative good news, as has been the case for more than two years, employment fell in April, and at a slightly faster pace than in the previous month.
More than twice as many panellists recorded job cuts as pointed to an increase in staffing levels.
Although input prices fell further, the rate of decline eased to the weakest in the current 16-month period. Lower input costs largely reflected increased competition among suppliers, while higher fuel costs limited the pace of reduction.
The twenty-first consecutive monthly decline in charges was substantial, despite slowing to the weakest since September 2008. The Financial Services sector continued to record charge inflation, contrasting with the trend seen across the services economy as a whole.
Profits at Irish service providers decreased again, although the pace of decline was the slowest in the current sequence which began in August 2008.
According to panellists, profits had been hit by difficulties in securing new business, and reduced charges.
