Italy Services Growth Strongest Since July 2007

The latest survey data signalled that capacity constraints remained evident across both the manufacturing and service sectors, as the volume of outstanding business rose for the twentieth successive month.

"Service sector expansion slid to a 16-month low, reflecting a marked waning in growth of demand for business and consumer-facing services such as hotels and restaurants".

Along with reports last week showing a slowdown in manufacturing and a near-stagnation in construction, Markit said the gauges suggest economic growth has slowed "sharply".

Despite the improvement in services activity, composite PMI, which tracks both manufacturing and services businesses, fell to 52.5 from 53.0 in December.

Samuel Tombs, chief United Kingdom economist at Pantheon Macroeconomics, examined the data's relevance to the Bank of England's current interest rate policy stance.

United Overseas Bank (Malaysia) Bhd senior economist Julia Goh said the improved PMI reading for Malaysia is in tandem with the gains across most regional PMI readings in January.


Mr Williamson also noted: "While the fourth quarter PMI readings were historically consistent with the economy growing at a resilient quarterly rate of 0.4-0.5 per cent, in line with the recent GDP estimate, the January number signals a growth rate of just under 0.3 per cent".

Efforts to offset this by rising prices comes at a tricky time for the British consumer, with households in the grip of a challenging income squeeze on the back of higher inflation and weaker wage growth. That's the lowest since September 2016 and well below the 54.1 economists had forecast.

There has been an upsurge in the Indian service sector with it expanding in January.

Hiring continued at a robust pace, suggesting a positive pipeline of new projects and positive output expectations, Markit said. Business confidence rises to the levels of March 2017.

"[The data] strengthen the case for the Bank to take a lengthy pause before raising interest rates again; we see the next hike coming in August".

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  • Rita Burton