Global Services Output Expands Again During August
At 52.3 in August, down slightly from 52.6 in July, the JPMorgan Global Services Business Activity Index signalled an expansion of service sector output for the thirty-seventh successive month. However, the rate of increase was only modest and below the average for that period.
David Hensley, Director of Global Economics Coordination at JPMorgan, said: “The global service sector continued to expand in August, offsetting some of the weakness exhibited by manufacturing. Rising cost inflation and muted new order growth suggest that the exansion in the sector will remain only modest in
The US non-manufacturing sector continued to expand at a robust clip in August, despite the rate of increase easing slightly from July’s four-month peak. Rates of expansion accelerated in the UK, India, Russia and Hong Kong, while there was a return to growth in Ireland.
The Eurozone continued to contract, as levels of business activity declined across the region’s big-four service economies (Germany, France, Italy and Spain). Business activity also declined in Japan and Brazil.
New business also increased for the thirty-seventh successive month in August. However, the rate of expansion remained lackluster and was the joint-weakest during that period. With output still rising at a faster pace
than new orders, companies were able to make further inroads into backlogs of work.
Outstanding business declined for the third month running, with reductions reported in almost all of the nations covered by the survey. Modest increases were seen in the US, India and Hong Kong.
The ongoing expansion in services output and efforts to clear backlogs of work encouraged companies to raise
employment for the seventh time in the past eight months. Job creation was recorded in the US, Germany, the UK, China and India August data pointed to a marked acceleration in the rate of input price inflation, with costs rising at the quickest pace for five months. Where an increase was reported, this was often linked to higher oil and transportation prices.