Spanish services sector grows in February, hiring picks up: PMI

[MADRID] Spain's services sector took on staff at the fastest pace in over seven years in February as new business kept expanding, echoing an economic recovery which is fuelling companies' optimism, a poll showed on Wednesday.

Markit's Purchasing Managers' Index (PMI) of services companies fell to 56.2 in February, down slightly from 56.7 in January, but still marking the 16th month in a row that the index was above the 50 line separating growth from contraction.

A Reuters poll of economists had forecast a repeat reading of 56.7 per cent.

"The Spanish service sector maintained its recent run of growth in February, and there were several causes for optimism within the underlying data," Andrew Harker, economist at Markit, said.

Optimism at Spanish services companies was the strongest in 11 years as they expected sales to grow in 2015, the Markit survey found - a rosier outlook that was also reflected in the faster pace of new hiring, with job creation increasing to its sharpest rate since November 2007.

High unemployment is still one of the main drags on Spain's accelerating economic recovery, with nearly one in four of the workforce out of a job.

The services sector accounts for around half of Spain's output, and strong hiring among these companies would help sustain a gradual turnaround there too.

New orders increased in February at the quickest pace since July of last year while transport providers, which have benefited from falling fuel costs as global oil prices tumble, were among those which saw the biggest rise in activity.

REUTERS