Italy February services PMI 53.0 vs 50.9 expected

• Prior 50.4
• Composite PMI 51.9
• Prior 49.7

The Italian economy inched back into expansion territory in February, helped by a strong showing in the services sector. New business showed a modest improvement, helped mostly by domestic sales. HCOB notes that:

“Finally, some good news for Italy. For the first time in four months, the HCOB Composite PMI is back in the growth zone.
This is mainly due to the strong performance in the services sector, while the manufacturing PMI has shown some
improvement from a weak level.

“Activity in Italy’s services sector increased significantly in February. Companies reported higher sales and the acquisition of
new customers. This is also reflected in the order situation. New orders grew again after two months of decline. Although
foreign orders remain in decline, attributed to the weak European economy, there is a slight upward trend indicated by a
rising index.

“The somewhat better order situation is directly impacting employment and backlogs. Italian service companies hired more
employees in February. This is partly due to the formation of backlogs that require additional manpower to clear.

“On the price front, an uncomfortable trend is emerging. Cost pressures faced by service providers are accelerating. Rising
personnel and energy costs, as well as higher service fees, were identified as price drivers by service companies. These
costs are being passed on to customers. The corresponding HCOB Prices Charged Index posted well above the historical
average.”

This article was written by Justin Low at www.forexlive.com.