The Institute for Supply Management (ISM) announced on Wednesday that
its Services PMI came in at 56.7 percent in July, recording an advance of 1.4
percentage points from an unrevised June
reading of 55.3 percent. The
latest data pointed to the continuation of expansion in the U.S. services
sector for the 26th month in a row at the fastest pace in three months.
Economists predicted the indicator to decline to 53.5 in July. A reading
above 50 signals expansion, while a reading below 50 indicates contraction.
Of the 18 services industries, 13 demonstrated expansion
last month, the ISM said.
According to the report, the New Orders index climbed 4.3 percentage
points to 59.9 percent and the Production index surged 4.3 percentage points
also to 59.9 percent. In addition, the Employment measure rose 1.7 percentage
points to 49.1 percent but reminded in contraction territory. At the same time,
the Supplier Deliveries gauge plunged
4.1
percentage points to 57.8 percent, while the Inventories indicator declined 2.5
percentage points to 45.0 percent and the Backlog of Orders indicator decreased
2.2 percentage points to 58.3 percent. On the price front, the Prices index tumbled
7.8 percentage points to 72.3 percent. This was the first reading below the 80-percent-mark since September
2021 and marked the sharpest m-o-m drop since May 2017 (-8.7 percentage points).