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Italian Service Activity Picks Up in July After Lockdown

MILAN (Reuters) - Italy’s services sector returned to growth in July, following the easing of tight coronavirus lockdown measures, with business activity up for the first time since February when the pandemic hit, a survey showed on Wednesday.

The IHS Markit Business Activity Index for services rose to 51.6 from 46.4 in June, climbing above the 50 mark that separates growth from contraction for the first time in five months.

The median forecast in a Reuters survey of 16 analysts had pointed to a reading of 51.1.

Markit said survey respondents frequently put the improvement down to slightly higher demand and the loosening of lockdown restrictions but it said the data indicated a still muted recovery so far.

The improved picture in the services sector follows IHS Markit’s sister survey for manufacturing on Monday, which showed factory activity rebounding to its highest level in two years after the lockdown began to ease in May.

The composite Purchasing Managers’ Index (PMI) for services and manufacturing climbed to 52.5 in July from 47.6 in June, showing the quickest expansion in private sector output since July 2018.

The euro zone’s third-largest economy contracted 12.4% in the second quarter from the previous three months and 17.3% year-on-year, preliminary data showed on Friday. The fall was less severe than many analysts had predicted.

Reporting by James Mackenzie; editing by John Stonestreet

Source: Reuters

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