The country's services sector contracted for the first time in over five years in April as inflationary pressure caused by the Middle East conflict intensified and new business orders contracted, a survey showed today.
The AIB S&P Global Services Purchasing Managers' Index sank to 49.7 in April from 50.7 in March, slipping below the 50-mark that separates growth from contraction for the first time since February 2021.
That was ahead of the flash euro zone PMI at 47.4, but below US and British levels.
The report looks at the business services sector, the financial services sector, the technology, media & telecoms sector and the transport, tourism & leisure sector.
"Economic uncertainty, higher costs and geopolitical tensions were cited as key drivers of the downturn," AIB's chief economist David McNamara said in a statement.
New business contracted marginally in April, ending a period of rising demand that began in March 2021. New export business also fell for the first time since June last year, the survey showed.
Cost pressures intensified, with input price inflation accelerating to its highest since December 2022, driven by fuel, freight and energy costs as well as wage increases.
Companies passed those increases on, pushing prices charged to a two-year high, the survey found.
The 12-month outlook stayed positive but subdued, slightly above March's 65-month low.
