Italy service sector growth picks up slightly in August: PMI

[ROME] Italian service sector activity accelerated slightly for the third month running in August, a survey showed on Monday, offering some support among a recent string of mostly weak indicators of future economic growth.

The Markit/ADACI Business Activity Index (PMI) for services companies rose to 52.3 in August from 52.0 in July, beating expectations and moving further above the 50 mark that separates growth from contraction.

A Reuters poll of five analysts had pointed to a reading of 51.9.

The eurozone's third-largest economy emerged from a three-year recession in 2015 but growth has slowed and looks likely to fall short of the government's 1.2 per cent target this year. Gross domestic product unexpectedly stagnated in the second quarter.

Markit's sister survey for manufacturing, released last week, showed that sector contracted in August for the first time since January 2015.

The services PMI showed levels of new and outstanding business both picked up in August, although employment growth slowed.

The sub-index for new business increased to 52.7 from 52.3 in July to post its highest reading since February this year.

But the composite PMI for services and manufacturing slipped in August to 51.9 from 52.2 in July.

After 0.8 per cent GDP growth last year, most analysts now expect expansion to be below 1 per cent this year and less in 2017.

REUTERS