Irish services joined manufacturers in ending 2017 with a substantial gain, as activity reached an eight-month high and expectations pointed to a strong year ahead, a survey showed yesterday.

The Investec Services Purchasing Managers’ Index (PMI) jumped to 60.4 in December from 56.0 a month earlier, when it had slipped to a 12-month low.

The index has stayed well above the 50 mark that separates growth from contraction since August 2012, when Ireland was halfway through a three-year financial bailout.

It has since gone on to become Europe’s fastest growing economy.

The improvement in December appeared to be driven by domestic business.

Growth in new export orders moderated, even though respondents reported higher orders from UK clients.

The sub-index measuring business expectations rose to 71.5 from 69.8 in November, and the survey’s authors said roughly half the panelists forecast a rise in activity over the coming 12 months, compared with just seven per cent expecting a decline.

A survey earlier this week showed that Irish manufacturing activity expanded last month at the fastest pace since the series began in 1998, contributing to a record high that was also recorded across the eurozone.

“Combining that with today’s eight-month high in the headline services PMI indicates that the momentum behind the Irish economy going into 2018 is very strong,” Investec Ireland chief economist Philip O’Sullivan said.