Jul Services PMI: Weaker But Still-Strong Underlying Dynamics

Spanish Services PMI unexpectedly slipped in July to 61.9 (vs 63.2 expected from a multi-year high of 62.5 in June). Some highlights from the IHS Markit release:

• On demand: "underpinned by the increasingly positive health situation...New export sales also continued to rise at a solid pace, although there were some reports that increased infection numbers due to the emergence of the delta variant of COVID-19 had weighed on foreign demand with the cancellation of some orders reported."
• On backlogs: "Backlogs of work rose for a fourth successive month, with the rate of growth accelerating to the fastest since February 2000."
• On employment: "Employment overall rose for a fourth month in a row, with not only higher sales, but the reopening of facilities and the return from furlough of staff also underpinning hiring activity."
• On prices: "Although easing since June's recent high, the rate of inflation was again considerable ... Spanish service providers raised their own charges...the rate of inflation was softer than June's multi-year record, but marked nonetheless."
• On confidence: Still strong, but hospitality sector future activity confidence fell to a 4-month low.

Source: IHS Markit, MNI