Financial News: U.S. Service Sector Growth Slows More Than Expected

U.S. Service Sector Growth Slows More Than Expected In November

12/04/2024 - 10:19:00 (RTTNews)

(RTTNews) - A report released by the Institute for Supply Management on Wednesday showed U.S. service sector growth slowed by more than anticipated in the month of November.

The ISM said its services PMI fell to 52.1 in November from 56.0 in October. While a reading above 50 still indicates growth, economists had expected the index to show a much more modest decrease to 55.5.

The bigger than expected pullback by the headline index came as the business activity index slid to 53.7 in November from 57.2 in October and the new orders index slumped to 53.7 in November from 57.4 in October.

The employment index also dipped to 51.5 in November from 53.0 in October, indicating a modest slowdown by the pace of job growth in the service sector.

Despite the decrease by the services PMI, Steve Miller, Chair of the ISM Services Business Survey Committee, noted, "14 industries reported business activity growth, and 13 indicated new orders expansion; both figures are improvements compared to October."

"This reinforces the view over the last several months that the services sector has returned to sustained growth," he added.

On the inflation front, the report said the prices index crept up to 58.2 in November from 58.1 in October, indicating a slightly faster pace of price growth.

The ISM released a separate report on Monday showing its reading on U.S. manufacturing increased by more than expected in the month of November but continued to indicate a contraction.

The ISM said its manufacturing PMI rose to 48.4 in November from 46.5 in October, although a reading below 50 still indicates contraction. Economists had expected the index to inch up to 47.5.

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