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Spain's service sector continues to grow in May, PMI shows
[MADRID] Business activity in Spain's service sector maintained its growth in May, buoyed by increased client demand, providing hope an economic recovery may still be in full bloom despite sluggish manufacturing activity reported earlier this week.
Markit's Purchasing Managers' Index (PMI) of service companies rose to 55.4 from 55.1 in April, signalling a further monthly increase in activity at Spanish service providers. Activity has risen for 31 straight months.
Anything above 50 indicates expansion; anything below, contraction. May's rate of growth was the fastest since last November.
The rate of expansion in new business also picked up in May, and Spanish service providers continued to hire more staff as a result.
However, confidence eased from April's reading, dipping to a three-month low. It still showed healthy growth, at 69.7 compared with April's 73.5.
But the decline reflects uncertainty as Spain prepares to vote for the second time in six months in June, following an inconclusive December election.
"Following on from Wednesday's disappointing Spain manufacturing PMI numbers, the latest services data are something of a relief, with growth in activity and new business ticking up slightly," said Andrew Harker, senior economist at Markit.
"The figures provide hope that the sector will be able to successfully weather headwinds such as a weak global environment and domestic political instability and remain in growth territory in the near-term at least."
Spanish manufacturing activity expanded in May at the slowest rate since October as growth in new orders slumped, a survey showed on Wednesday.
Detailed PMI data are only available under licence from Markit and customers need to apply to Markit for a licence.