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Growth in Ireland’s service economy softened in March, according to data from S&P Global on Wednesday.
The latest AIB services purchasing managers’ index fell to 55.7 points for last month, from 58.2 in February.
The neutral 50-point mark separates expansion from contraction, so the latest reading suggests growth slowed.
Input price inflation eased to a 21-month low, while output charge inflation reduced to an 18-month low, but price pressure remains strong.
‘While the pace of price increases eased in March, inflationary pressures remained elevated throughout the services sector. Businesses continued to report upward pressure on prices across a broad range of inputs, in particular wages and energy bills. Higher costs continue to be passed on in higher prices to customers, with the rate of increase in selling prices still steep, despite falling an 18-month low,’ said Oliver Mangan, AIB chief economist.
‘March saw a strong expansion in activity and good growth in new business, especially from abroad, for the four sectors covered in the survey. Most notably, the transport/tourism/leisure sector returned to expansion territory for the first time since August, helped in particular by a strong rise in new business.’
Ireland’s service sector reported a 25th consecutive monthly rise in the level of outstanding work across the sector in March, owing to an ongoing rise in sustained orders and reports of labour shortages.
The services PMI is compiled by S&P Global from the responses to surveys sent to about 400 service providers in Ireland, with data collected between March 10 and 28.
Growth in the wider private sector slowed.
The composite PMI, a weighted average of the services and earlier manufacturing reading, faded to 52.8 points in March, from February’s nine-month high of 54.5.
‘Although indicative of a fourth successive expansion in the Irish private sector economy, the latest reading was down from February’s nine-month high and subdued by historical standards,’ S&P Global said.
The manufacturing PMI fell to 49.7 in March from 51.3 in February, according to data on Monday.
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