Italian service sector contracts for first time in 2024, PMI shows
2024.12.04 05:48
ROME (Reuters) – Italy’s service sector activity contracted in November for the first time this year, a survey showed on Wednesday, boding ill for growth prospects in the euro zone’s third largest economy.
The HCOB Purchasing Managers’ Index for Italian services came in at 49.2 in November, down from 52.4 the month before and below the key 50 level that separates growth from contraction.
The reading, hit by a marked decrease in new business, was below a median forecast of 51.2 in a Reuters survey of 10 analysts.
It ended a ten-month run of growth that had propped up the economy by offsetting a long-running slump in the smaller manufacturing sector.
“Italy is set to end the year with weak growth in the fourth quarter,” said HCOB economist Jonas Feldhusen.
The survey’s new business sub-index dropped steeply to 46.7 from a previous 51.9 – its most pronounced decline in over two years – while the employment index rose slightly to 50.5 from 49.9 in October.
The sister survey for the manufacturing sector issued on Monday showed contraction for an eighth month running in November, and at the fastest pace this year.
The composite Purchasing Managers’ Index, combining services and manufacturing, also fell into contraction in November, coming in at 47.7 from 51.0 the month before.
Italy’s economy stagnated in the third quarter from the previous three months due to a slump in exports and investments, national statistics bureau ISTAT reported this week.
ISTAT said that if growth also stagnates in the last three months then full-year expansion will come in at just 0.5%, half the government’s official forecast of 1%.
