Italian service activity picks up in July after lockdown: PMI

Marco Green
August 5, 2020

AFPFirms remained pessimistic about the next 12 months and cut jobs at the fastest pace on record.

"Moreover, the latest reading was among the lowest recorded in almost 15 years of data collection, surpassed only by the unprecedented falls in the previous three months", the statement said.

Growth in China's services sector slowed in July from a decade high the previous month, as new export business fell and job losses continued, an industry survey showed on Wednesday, pointing to cracks in the sector's post-COVID recovery.

The IHS Markit India Services Business Activity Index stood at 34.2 in July, slightly higher than 33.7 in June. Business activity and new orders dropped again, with the rates of decline remaining rapid overall.

Faring worse still was foreign demand for Indian services with the respective seasonally adjusted index posting well below the 50 mark in July for the fifth month running and signalling a substantial reduction in foreign demand.

Hong Kong's Center for Health Protection reported 80 new confirmed cases of COVID-19 on Tuesday, taking the total tally to 3,669.

Nonetheless, reflecting on the flipside of the coin, some analysts had expressed frets over a second wave of pandemic outbreak which would likely to keep the Asia's factory activity feeble despite an intransigent response from Chinese economy, while citing that a pandemic resurgence would weigh heavily on domestic and overseas investments, a senior economist at Oxford Economics, Stefan Angrick said following reveal of China's Caixin Manufacturing PMI data, "With the pace of recovery slowing in some of Japan's key trading partners, exports and business spending are likely to continue to struggle".

"With such a prolonged and significant downturn, any substantial recovery will take many months, if not years", IHS Markit's Cooper added.

The latest IHS Markit estimates point to an annual contraction in GDP of over 6% in the year ending March 2021.

The Caixin Services PMI™, released by Markit Economics, is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 private service sector companies. "That's not surprising with lockdown measures still in force, but undoubtedly these will have to be loosened and companies reopen before the sector can move towards stabilisation", Cooper said.

The services sector is hugely important to the United Kingdom economy - it includes finance, law, retail, engineering, and consulting - and accounts for around 80% of the country's economic output. The company delivers next-generation information, analytics and solutions to customers in business, finance and government.

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