Activity in Spain’s service sector expanded in June at the fastest pace in more than two decades as COVID-19 restrictions on travel were partly phased out, a survey showed on Monday.
IHS Markit’s Purchasing Managers’ Index (PMI) of services companies, which account for around half the country’s economic output, rose to 62.5 last month from 59.4 in May. The 50 mark separates growth from contraction.
The index was at its highest level since March 2000.
Between March 2020, when the first coronavirus restrictions were imposed and May 2021, the indicator has been below 50 every month but June and July last year, when Spain emerged from its first lockdown.
“Spain’s service sector lifted off in June, as restrictions on economic activity continued to be eased and market activity subsequently jumped,” IHS Markit said in a statement.
The end of restrictions in Spain and in other European countries where quarantines were imposed on tourists returning home, allowed for a tourism take off in the month.
The number of foreign tourists in Spain likely kept on rising in June after it doubled in May compared with April even though the figure remained 80% below 2019 levels.
A sister survey of manufacturers on Thursday showed the fastest rate of expansion in 23 years at 60.4 in June, up from 59.4 in May.
While Spain’s economy shrank 0.4% in the first quarter as COVID-19 restrictions hurt businesses, Prime Minister Pedro Sanchez said earlier this week that the country’s output expanded a record 18% in the second quarter from a year ago.
The government expects the economy to grow 6.5% this year after 2020’s record 10.8% contraction.
Photo: A woman pushes a wheelchair in downtown in Barcelona, Spain. EPA-EFE/Quique García
