Growth service industry turnover slows to 5.8% in Q2 from 11.2%

The growth in turnover in service industries in Portugal went from 11.2% in the first quarter of this year, to an increase of 5.8% in the second quarter, in year-on-year terms, the National Statistics Institute (INE) announced on Tuesday.

The statistics office also said that turnover in services went from a nominal year-on-year growth of 7.7% in May to 4% in June.

The turnover index in services registered a year-on-year increase of 4% in June, which “reflects a slowdown of 3.7 percentage points (p.p.) compared to the rate observed in May this year”, INE also clarifies.

In addition, it emphasises that the index not adjusted for seasonality and calendar effects decelerated year-on-year to 6.2% in June, against an increase of 7.5% in the previous month.

Wholesale trade and repair of motor vehicles and motorbikes fell by 0.2% in June, 3.3 percentage points (pp) less than in May, causing the only negative contribution (minus 0.1 percentage points [pp]) to the growth of the total index.

According to Statistics Portugal, the wholesale trade was a determining factor for the observed result, registering a fall of 5.9%, intensifying the decrease registered in May, of minus 1.7%.

On the contrary, the index of trade, maintenance and repair of motor vehicles and motorbikes, “accelerated slightly”, to a growth of 24.2% (24.0% in May), points out INE.

Accommodation, food services and similar, in turn, contributed 1.3 percentage points (p.p.) to the growth of the aggregate index, as a result of an increase of 14% in June, against an increase of 14.2% in May, it adds.

According to INE, accommodation rose 13% in June, slowing down from the growth recorded in the previous month (21.2%), while catering and similar activities grew 14.4% (11.7% in the previous month).

Consulting, scientific and technical activities and similar activities recorded the largest deceleration, with a 12.4 percentage points (pp) decrease from the previous period, presenting an increase of 15.8% and the second largest contribution (1.1 pp) to the total result. In monthly terms, the turnover index fell by 2.9 per cent in June, compared to the 2.8 per cent growth in May this year.

The employment, compensation of employees and hours worked indices, adjusted for calendar effects, showed year-on-year increases of 3.5%, 11.8% and 5.7%, respectively, against increases of 3.9%, 10.8% and 2% in May this year, in the same order.