Italy private sector grows at faster pace in July, boosted by services

Italy private sector growth slightly accelerated in July, driven by services performance, as results of a S&P Global survey showed on Tuesday.

The Italy Hamburg Commercial Bank services purchases managers' index rose to 52.3 in July from 52.1 in June, remaining above the 50.0 threshold, which separates contraction from expansion in the sector's activity. It was softer than the FXStreet-cited consensus of an uptick to 52.5 in July.

S&P Global said surveyed companies cited higher order volumes, partly due to new clients and the start of new projects, which in turn contributed to increased activity.

In July, total new orders received by the Italian services sector increased again, with companies attributing this to higher sales and marketing initiatives.

Considering the decline in foreign orders, data collected in July reveal stable demand for services, primarily in the domestic market.

Italian service providers responded to this growing flow of new orders at the start of the third quarter by creating new jobs.

With the service sector continuing to grow, companies expressed confidence in increased activity over the next 12 months. The optimism was fueled by the acquisition of new clients and projects, as well as hopes for improved macroeconomic conditions.

The services PMI features a panel of 400 service sector companies in Italy, with responses collected between July 10 and 28.

On Friday last week, S&P Global reported that Italy manufacturing PMI rose to 49.8 point in July from 48.4 in June, still remaining in contraction territory.

As a result, the composite PMI – an average of services and manufacturing figures – rose to 51.5 points in July from 51.1 in June.