Service sector growth accelerated last month, according to the latest NCB purchasing managers' index. It shows the overall index of activity in the sector rising to 59.4 from 57 the previous month. Cliff Taylor, Economics Editor, reports
Any reading above 50 indicates that the sector is expanding and the November reading was the 18th successive month above this level. The rise in November indicated "a strong and accelerated rate of expansion", according to the survey results.
Firms surveyed "reported that activity was stepped up to accommodate rising levels of incoming new business, and increased demand was generally associated with a more buoyant domestic economy". The strength of the Irish reading is in contrast to the overall euro-zone index, which weakened last month. However the UK and US indices, also published yesterday, both indicated a healthy picture.
Just under 40 per cent of respondents to the Irish survey pointed to an increase in their activity from the previous month, compared with 14 per cent that indicated a decline. Volumes of incoming new business continued to expand and respondent firms reported particularly strong domestic demand. Meanwhile, staffing levels in the sector continued to grow.
Firms reported rising costs, mainly due to rising oil prices and increasing salaries. However, firms generally remained confident about the year ahead.
The overall euro-zone services sector expanded at its slowest pace in 15 months in November as a strong euro made it hard for firms to stay competitive and new business growth neared stagnation, a separate survey showed.
The Reuters Euro-Zone Business Activity Index fell to 52.6 in November from 53.5 the previous month, hitting its lowest level since August 2003 and well below the consensus forecast of 53.3.
