Manufacturing and Services activities improved in June as per the statistics and data compiled by the Central Bank.
It said manufacturing activities recovered marginally during June 2021 from the adverse impacts of the third wave of the COVID-19 pandemic.
All the other sub activities, except Suppliers’ Delivery Time, edged up from the previous month. The New Orders, especially in the Manufacture of Food and Beverages sector, increased significantly.
However, many respondents to the survey mentioned that they experienced delays in making overseas payments and in opening letters of credit for import purposes.
Exporters involved in exports of goods mention that they continuously experience difficulties in reserving shipping spaces on top of the short supply of empty containers.
.Services sector returned to the growth territory in June 2021, recording an index value of 51.3, after declining for two consecutive months.
This improvement was mainly driven by the increase in expectations for activity supported by the relaxation of travel restrictions.
New businesses sub-index improved in June 2021 compared to May 2021, particularly with the improvements observed in Education and Financial Services sub-sectors. However, Wholesale and Retail Trade, Accommodation, Food and Beverage and Other Personal Activities subsectors saw declines during the month.
Business activities sub-index improved in June in line with the relaxation of the travel restrictions towards the latter part of the month. Accordingly, Insurance, Education, Professional Services and Transportation sub-sectors saw improvements during the month.
Nevertheless, Wholesale and Retail Trade, Other Personal Activities, Accommodation, Food and Beverage and Real Estate Activities subsectors continued to decline with a dip in demand related to discretionary goods and services due to the spread of the third wave of COVID-19 pandemic.
Employment continued to fall, yet at a slower pace, in June due to retirements and resignations amid a halt in new recruitments in line with contracted business requirements.
Backlogs of work grew further in June due to disruptions on business operations amid the extension of islandwide travel restrictions and localised lockdowns.
Expectations for business activities for the next three months picked up from May with the positive sentiments reinforced by the relaxation of travel restrictions, while some respondents expressed their concerns related to import restrictions.