Business groups fear government will halve energy support after March, while commuters face more disruption on the railway
Spain’s service sector enjoyed modest growth in December for a second month, with growth in jobs, while cost inflation eased noticeably.
The monthly business activity index from S&P Global rose to 51.6 last month from 51.2 in November, above the 50 mark that divides expansion from contraction. This marked the strongest growth in the service sector since July.
The Spanish service sector more than held its ground at the end of year, registering back-to-back rises in activity and new business. Although modest, when viewed through the prism of widespread cost pressures and ongoing economic uncertainty, the latest data point to reasonable sector performance, even more so when we add in another month of employment gains.
However, ongoing high inflation and reports of suppliers seeking to repair margins add to worries that price pressures will remain elevated and weigh on activity and consumption for some time to come. Indeed, this remains the overwhelming worry for many firms at the start of 2023, and as a result, confidence in the outlook remained historically subdued.
Business groups fear government will halve energy support after March, while commuters face more disruption on the railwaySpain’s service sector enjoyed modest growth in December for a second month, with growth in jobs, while cost inflation eased noticeably.The monthly business activity index from S&P Global rose to 51.6 last month from 51.2 in November, above the 50 mark that divides expansion from contraction. This marked the strongest growth in the service sector since July.The Spanish service sector more than held its ground at the end of year, registering back-to-back rises in activity and new business. Although modest, when viewed through the prism of widespread cost pressures and ongoing economic uncertainty, the latest data point to reasonable sector performance, even more so when we add in another month of employment gains.However, ongoing high inflation and reports of suppliers seeking to repair margins add to worries that price pressures will remain elevated and weigh on activity and consumption for some time to come. Indeed, this remains the overwhelming worry for many firms at the start of 2023, and as a result, confidence in the outlook remained historically subdued. Continue reading…
