Italy service sector grows at fastest rate in three years in Feb - PMI Italys service sector grew at the fastest rate in three years in February, a survey showed on Wednesday, adding to signs that the economy is pulling out of a long recession. The Markit/ADACI Business Activity Index, covering companies from bars to banks, climbed more than expected to 52.9 from Januarys 49.4, putting it well above the 50 line that separates growth from contraction. The reading was the highest since March 2011 and above all forecasts in a Reuters survey of analysts that pointed to a modest uptick to 49.8. Markit economist Phil Smith said Italy, which emerged from its longest post-war recession in the fourth quarter of 2013 with marginal economic growth of 0.1 percent, should see further expansion in the first three months of this year. Service sector business activity not only rose during February, but the rate of growth was solid and supported by the fastest increase in new work for almost four years, he said. Services make up around 70 percent of Italian gross domestic product, including public services not covered in the survey. Markits sister survey for the manufacturing sector showed growth for an eighth straight month in February, although at a slower rate than the month before. Markits Italian composite index, which tracks growth in both the manufacturing and service sectors, rose to 53.4 in February, the highest reading since April 2010. In the services report, the sub-index on new business jumped to 54.4 from 50.8 to post its highest reading since March 2010, laying the foundation for an increase in overall activity. Outstanding business also posted a significant rise but business expectations for the next 12 months were less upbeat than in January and the subindex on employment fell further below the 50 mark, showing job-shedding is still accelerating despite the signs of a pick-up in the economy. Official data last week showed joblessness hit 12.9 percent in January, the highest since at least 1977 when records began, while youth unemployment rose to a record 42.4 percent. Italy is officially forecasting economic growth of 1.1 percent this year after contractions of 1.9 percent last year and 2.4 percent in 2012. Still, most independent estimates are less optimistic. The International Monetary Fund, the European Commission and the Organisation for Economic Co-operation and Development all forecast Italian growth of just 0.6 percent this year.
Posted on: Wed, 05 Mar 2014 08:54:46 +0000
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