US service sector’s economic activity surges last month for 6th time in 2024
(MENAFN) Economic activity in the US service sector saw an increase in August, marking the sixth rise this year, as reported by the Institute for supply Management (ISM) on Thursday. The ISM's Non-Manufacturing Purchasing Managers' Index (PMI), which gauges the performance of the service sector, registered at 51.5 percent for August. This figure represents a slight improvement from July’s reading of 51.4 percent and aligns closely with market expectations, which had anticipated a reading of 51.3 percent.
A PMI reading above 50 indicates expansion within the service sector, while a figure below 50 would suggest contraction. The August index thus confirms continued growth, albeit at a modest pace. This persistent expansion in the service sector reflects a gradual uptick in economic activity, despite various challenges.
ISM Chair Steve Miller noted that while there is evidence of growth, it remains slow to moderate across several industries. He highlighted that high operational costs and ongoing pressure from elevated interest rates are negatively impacting business performance. These factors contribute to a general softness in sales, affecting overall sector performance.
Overall, the data underscores a mixed economic environment in the service sector, where growth continues but is tempered by persistent cost pressures and interest rate impacts. The slight increase in the PMI indicates that while the sector is expanding, it faces significant headwinds that could influence future performance.
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