Irish Service Sector Contracts Further In January

Ireland's service sector contracted for the second straight month in January, data from a survey by Markit Economics and NCB showed Friday.

The seasonally adjusted purchasing managers' index (PMI) for the service sector dropped to 48.3 in January from 48.4 in December. A PMI reading below 50 indicates contraction in the sector, while one above suggests growth. The sector contracted for the second consecutive month.

New business received by Irish service providers decreased further in January, though at a slower rate, amid uncertain economic conditions. Backlogs of work depleted for the second month running, reflecting increased utilization of capacity as new business declined.

Employment in the sector decreased during the month as workloads fell markedly. Input cost inflation accelerated in January, though at weaker-than-average rate, owing mainly to higher fuel costs, impacts of a rise in VAT and a drop in the value of the euro. Output prices, however, decreasing for the forty-second successive month, as firms tried to sustain margins amid intense competition. (Provided by RTTNews)