Italy PMI services rose to 54.3 in June, up from 53.1 and beat expectation of 53.3. Markit noted that was fastest rises in activity and new work since February. Backlogs also increased at the fastest pace in over eight years. Input price inflation rose to highest level since June 2016.
Paul Smith, Economics Director at IHS Markit which compiles the Italy Services PMI® survey, said:
“There was a welcome upturn in service sector expansion during June, with both activity and new work registering stronger gains relative to the previous month.
“The data raise hopes that the services economy is recovering from the general growth slump that has been observed since expansion hit a multi-year high at the start of the year.
“Whilst less exposed to the trade-induced downswing that has hit manufacturing – and in that respect rising global protectionist measures – political instabilities and the potential for tightening credit conditions are notable headwinds to growth in the coming months.
“Indeed, such factors continue to weigh on service sector business confidence, which hovered close to a two-year low in June. With that in mind, and following an expected rise of around 0.1% in Q2, GDP growth in the second half of the year is likely to remain in a fairly subdued range.”
