ISM Non Manufacturing: Modest Expansion
June 3, 2016
Bottom Line: Business activity in the services, construction, and government sectors of the economy decelerated in May, more than expectations and these sectors are now only growing at a modest pace. The level of activity has softened a bit with drop in new orders and order backlogs. Employment declined modestly and was at its lowest level since February, confirming todayâ€™s slight gains in jobs report. The ISM Non-Manufacturing Index FELL by 2.8 points in May to 52.9%, compared with market expectations for a small decline to 55.3%. The May reading was modestly lower than its average level over the past 12 months. That said, this was the 75th consecutive month that the non-manufacturing sector has expanded although the current level of the index indicates that the economy is growing only modestly. New Orders fell by 5.7 points to 54.2%. Order Backlogs declined modestly. Inventories were unchanged compared to last month. Employment fell by 3.3 points to 49.7%, as indicated by the soft employment report this morning. Prices increased by 2.2 points to 55.6%.
Article by contingentmacro