AIB released its latest Services PMI this morning which shows the services activity index (63.1) was at its highest level since 2016.
The return of services related sectors in June was the main driver, with positive contributions across the board on a sub-sectoral basis. Leading the way on this front was the Transport, Tourism & Leisure sector, a sector of which consumers had largely been deprived of before June. Domestic demand, in the form of new business orders, increased in strength for the fourth consecutive month while global demand, in the form of new export orders, continued to contribute.
Employment in services sectors surged in June at its fastest rate since 2017 while both input and output prices continued to rise as a result of supply-side shortages and Brexit-related checks.
According to Goodbody Stockbrokers, "The speed of recovery to date bodes well for our view of a 6.5% expansion in Core Domestic Demand in 2021. While concerns of the delta variant have been increasing in recent weeks, we do not expect it to have any material effect on the recovery. We will be monitoring the development of the situation in the UK as a guide."