Irish services growth slows in April as Brexit hits sales: PMI By Reuters

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© Reuters. A man walks past offices in the Irish Financial Services Centre in Dublin


© Reuters. A man walks past offices in the Irish Financial Services Centre in Dublin

DUBLIN, May 3 (Reuters) – Irish services sector growth slowed in April, a survey showed on Friday, adding to signs that the economy began the second quarter at a more moderate pace amid the global slowdown.

The AIB services purchasing managers’ index slipped to 54.7 from 55.3 in March, still comfortably above the 50 mark that has separated growth from contraction since 2012 but just above the near six-year low the series fell to in January.

The weaker expansion was driven by a fall in new orders, the subindex for which dropped to 54.1 from 55.7, the lowest reading in two-and-a-half years.

“Although the rate of expansion remained solid amid reports of improved customer demand conditions both domestically and abroad, some panellists indicated that Brexit had negatively impacted on sales,” AIB Chief Economist Oliver Mangan said.

“Softer new order growth resulted in a weaker increase of backlogs. Outstanding business rose modestly in April, with the rate of accumulation easing to its slowest in 69 months.”

Ireland has brushed aside the initial uncertainty from the 2016 vote of its nearest neighbour to leave the European Union, posting the fastest economic growth in the bloc for five straight years.

However a corresponding survey for manufacturers earlier this week showed that it was growing at the slowest rate since the aftermath of the Brexit vote, also due to a moderation in new orders.

“Overall, the AIB Services PMI reading of 54.7 for April suggests that the Irish economy is continuing to expand at a good pace, though not as strong as in recent years,” Mangan said.

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