The
Institute for Supply Management (ISM) announced on Friday that its
non-manufacturing index (NMI) came in at 69.1 in November, which was 2.4
percentage points higher than the unrevised October’s reading of 66.7 percent. The latest reading pointed to the
growth in the services sector for the 18th straight month, which was also the quickest
on record.
Economists
forecast the index to drop to 65.0 last month. A reading above 50 signals
expansion, while a reading below 50 indicates contraction.
All 18 services industries reported gains
last month, the ISM said, as demand continued to outstrip supply that had been
impacted by capacity constraints, shortages of labor, materials, and logistical
issues.
According
to the report, the ISM’s non-manufacturing Production measure rose 4.8
percentage points to 74.6 percent from the October reading, and its New Orders
gauge remained unchanged m-o-m at 69.7 percent, both being at all-time highs. In
addition, the Inventories indicator jumped 6.0 percentage points to 48.2
percent, and the Employment indicator climbed 4.9 percentage points to 56.5
percent, both making a positive contribution to the headline index. Elsewhere, the
Supplier Deliveries index was unchanged m-o-m at 75.7 percent. On the price
front, the Prices index decreased 0.6 percentage points to 82.6 percent,
recording its third-highest reading since September 2005, when it registered
the all-time high.
Commenting
on the data, the Chair of the ISM Services Business Survey Committee, Anthony
Nieves, noted that the past relationship between the Services PMI and the
overall economy indicated that the Services PM for November corresponded to a
6.9-percent gain in real GDP on an annualized basis.