ROME — Italy's services sector unexpectedly grew in September for the first time in more than two years spurred by new business, a survey showed on Thursday, suggesting the economy is slowly emerging from its longest recession in decades.
The Markit/ADACI Business Activity Index, covering companies from banks to hotels, jumped to 52.7 from 48.8 in August. That easily beat the average forecast of 49.1 in a Reuters survey of economists as well as the highest forecast of 49.8.
The data supports recent signs that the euro zone's third-biggest economy could finally be pulling out of its longest recession in six decades, which started in mid-2011.
A similar survey for the manufacturing sector this week showed activity there grew for the third month running in September. It is the first time the services sector index has moved above the 50 line indicating expansion since May 2011.
Markit economist Phil Smith said the data may signal a timid recovery towards the end of the year as long as there continues to be a stable government in Italy. Prime Minister Enrico Letta's government has been repeatedly on the brink of collapse in recent weeks.
On Wednesday, he won a confidence vote in the Senate after centre-right leader Silvio Berlusconi, faced with an imminent party split, backtracked on his threat to bring down the government.
"The data, alongside those for manufacturing, show Italian GDP at least stabilising in Q3 and perhaps even rising slightly for the first time in more than two years," Smith said.
"Political stability is key to this forward momentum being sustained into the later stages of the year and beyond." Services make up around 70 percent of Italian gross domestic product, including public services not covered in the survey.
While new business also increased for the first time in 28 months, with the subindex rising to 52.9 from 48.1 in August, employment in the private services sector continued its more than two-year slide, though at a slower pace.
Prices charged by service providers declined for a 26th month, and expectations were more positive than they have been in more than two years, Markit said.
nytimes.com
The Markit/ADACI Business Activity Index, covering companies from banks to hotels, jumped to 52.7 from 48.8 in August. That easily beat the average forecast of 49.1 in a Reuters survey of economists as well as the highest forecast of 49.8.
The data supports recent signs that the euro zone's third-biggest economy could finally be pulling out of its longest recession in six decades, which started in mid-2011.
A similar survey for the manufacturing sector this week showed activity there grew for the third month running in September. It is the first time the services sector index has moved above the 50 line indicating expansion since May 2011.
Markit economist Phil Smith said the data may signal a timid recovery towards the end of the year as long as there continues to be a stable government in Italy. Prime Minister Enrico Letta's government has been repeatedly on the brink of collapse in recent weeks.
On Wednesday, he won a confidence vote in the Senate after centre-right leader Silvio Berlusconi, faced with an imminent party split, backtracked on his threat to bring down the government.
"The data, alongside those for manufacturing, show Italian GDP at least stabilising in Q3 and perhaps even rising slightly for the first time in more than two years," Smith said.
"Political stability is key to this forward momentum being sustained into the later stages of the year and beyond." Services make up around 70 percent of Italian gross domestic product, including public services not covered in the survey.
While new business also increased for the first time in 28 months, with the subindex rising to 52.9 from 48.1 in August, employment in the private services sector continued its more than two-year slide, though at a slower pace.
Prices charged by service providers declined for a 26th month, and expectations were more positive than they have been in more than two years, Markit said.
nytimes.com
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