Ireland's services sector fell for the first time in four months in May, due to a stagnation of new orders and weakness in client confidence, according to the latest NCB Purchasing Managers' Index (PMI).
The PMI, which measures activity in the services sector, fell to 48.9 last month from 52.2 in April.
A PMI reading below 50 indicates contraction in the sector, while one above suggests growth.
NCB noted activity in the financial services sector was particularly weak, saying this was not surprising given euro area worries.
In contrast, Technology, Media and Telecoms activity expanded.
Overall new business decreased fractionally during May, ending a three-month sequence of growth. Respondents indicated that demand remained fragile, with clients reluctant to commit to new projects.
Service providers lowered employment marginally in May following no change in the previous month. Where staffing levels decreased, this was mainly linked to a lack of growth in new business, according to the index.
Meanwhile, input price inflation remained muted last month and was only slightly faster than April's eight-month low.
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