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Irish services sector sees first fall in new exports since 2016

Written by Business World, on 6th Aug 2019. Posted in General

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Ireland's services sector growth slowed in July after new exports contracted for the first time in almost three years amid growing fears about a disruptive no-deal Brexit, a survey showed on Tuesday.

The AIB services Purchasing Managers' Index (PMI) slipped to 55.0 in July from 56.9 in June -- still well above the 50 mark that separates growth from contraction, as it has been since 2012, when a rapid economic recovery began to take hold.

But the sub-index for new export orders fell to 49.4 from 53.4 in the previous month, the first contraction since November 2016. The authors cited a decrease in orders from the United Kingdom owing to Brexit uncertainty as a factor.

New British Prime Minister Boris Johnson has said will take the UK out of the European Union on Oct. 31 without a deal to smooth the transition if necessary.

Services continue to outperform manufacturing, where the corresponding July index last week was 48.7, indicating the slowest growth since April 2013.

"Overall, it appears that strong growth in the large services sector is helping the Irish economy to continue to expand at a good pace," AIB Chief Economist Oliver Mangan said.

The Irish index is well above the flash services July PMIs of 53.3 and 52.2 for the euro zone and United States respectively, he added, noting that firms appeared very optimistic for the year ahead. (Reuters)

Source: www.businessworld.ie

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