The latest PMI data shows that thanks to the first expansion of new orders since June, the Italian services sector has recorded a general stabilization of economic activity.
The S&P Global Services PMI came in at 49.9 for December, up from 49.5 in November and only marginally below the 50 no-change threshold. The reading for the final month of 2022 was also the highest since August, the last month in which the index indicated growth in the sector.
The sample companies primarily linked the increase to stronger customer demand. However, the increase in new orders did not manage to challenge operational capacity, as the level of work in progress (but not completed) from service companies indicated a further and slightly more rapid decline. The sector continued to hire additional staff thanks to a positive level of confidence. Meanwhile, price indices fell further. For the first time since June, the December survey also recorded a return to new order flow growth.
Also in December, the S&P Global PMI of Composite Output in Italy came in at 49.6 points from 48.9 in November, marking the sixth consecutive month of contraction in private sector output.