Provisional data from the Central Statistics Office (CSO) indicates a significant elevation in the services sector output of the Republic in April, when compared to the corresponding period in the previous year. Not only did the prices see an uptick, but the volumes also showed a yearly increase.
The CSO’s service index for the month, which analyses approximately 2,250 businesses, demonstrated a 9% turnover increase year-on-year till April end, credited to a general rise in prices throughout the economy. The acceleration showcased a growth rate from its March counterpart, which was 7.3%, according to the data.
Several industries marked substantial yearly inflations in turnover, the most notable ones including professional, scientific, and technical activities like legal consultancies, scientific probing, engineering programs, and similar ones. Within such sectors, the output values, calculated at current prices, exhibited a hike by 15.1%. Simultaneously, the tech-inclusive information and communication division saw their output value leap over 13% annually.
Despite this, the services sector output underwent an 8% increment volume-wise, implying heightened activity. The maximum volume growth, by 14.3%, was observed among information and communication businesses from April 2023. Alongside, transport and storage-associated services improved their output volumes considerably over a year, registering a 13.6% increase. Spikes were also noticed within wholesale and retail operations, as well as administrative and support services.
However, the accommodation and food services sectors painted a different picture, marking a 6% yearly reduction in output volume, as reported by the CSO.
AIB’s services sector management index for April, publicised the previous month, indicated persisting difficulties for service businesses amidst an ambiguous inflation scene.
AIB’s chief economist David McNamara remarked, “The sector demonstrates a complicated inflation situation.” He also added that despite the inflation rate softening for the second consecutive month in April, it continued to be substantially higher than the long-term average. Respondents in April particularly noted wage increases and fuel as the primary contributors to escalating costs. Despite this, companies persistently enhanced customer prices, causing a monthly acceleration in the output price index.
Nevertheless, McNamara asserted that this surge in output prices echoed a “strong consumer demand” for services in April.
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