Service sector

Removal of Covid curbs boosts service sector growth

Growth in the country’s services sector accelerated in January as some companies reported a recovery in business conditions and consumer confidence after nearly all Covid-19 restrictions were lifted, according to a survey released today. .

The AIB IHS Markit Purchasing Managers Index (PMI) fell from 55.4 in December to 56.2 in January.

The rate of expansion was well above the 50 mark that separates growth from contraction, but among the weakest on record in the current 11-month rally.

Today’s survey showed renewed growth in the transport, tourism and leisure sector, driven by the domestic market, including the beginnings of a recovery in local tourism.

Cost pressures remained elevated, but the rate of input price inflation eased to its lowest level in six months, while expenses rose at the slowest pace since last September.

“The acceleration in the pace of growth was evident in all four sub-sectors covered by the survey,” said AIB chief economist Oliver Mangan.

“This contrasts with the trend in other countries where Omicron has weighed on the sector. Flash January Services PMI readings for the Eurozone, UK and US fell to 51.2, 53 .3 and 50.9, respectively, well below the Irish level,” he said. added.

Most of the country’s Covid-19 restrictions were dropped on January 22 after withstanding a massive increase in cases of the Omicron variant of the coronavirus.

Ireland has one of the highest booster vaccination rates in Europe, which has helped keep the number of seriously ill people well below previous peaks.