- US ISM Services PMI came in higher than expected in July.
- Price pressures in the service sector eased modestly.
- US Dollar Index continues to push higher after the data.
The business activity in the US service sector expanded at a more robust pace in July than in June with the ISM Services PMI rising to 56.7 from 55.3. This reading came in better than the market expectation of 53.5.
Further details of the publication revealed that the Prices Paid Index declined to 72.3 from 80.1, compared to the market forecast of 81.6, and the Employment Index improved to 49.1 from 47.4.
Commenting on the survey, “the slight increase in services sector growth was due to an increase in business activity and new orders,” noted Anthony Nieves, Chair of the Institute for Supply Management (ISM) Services Business Survey Committee. “Availability issues with overland trucking, a restricted labor pool, various material shortages and inflation continue to be impediments for the services sector.”
Market reaction
The US Dollar Index gained traction after this report and was last seen rising 0.25% on the day at 106.60.
