The U.S. services sector expanded at a faster-than-anticipated pace in August, with the Institute for Supply Management’s non-manufacturing Purchasing Managers’ Index increasing to 55.4 from 54.1 in July. The reading surpassed the consensus forecast of 54.2 and remained above the 50-point threshold that separates growth from contraction.
The index, based on responses from over 370 purchasing and supply executives across more than 62 industries, is derived from four equally weighted diffusion indexes: Business Activity, New Orders, Employment, and Supplier Deliveries. A reading above 50 indicates expansion, while a figure below 50 signals contraction. The latest data suggests sustained momentum in the services sector, which accounts for the majority of U.S. economic activity.
The services sector, encompassing industries such as retail, hospitality, and finance, has now expanded for 12 consecutive months, reflecting resilience amid broader economic uncertainties. The August reading aligns with expectations for continued but moderate growth in the U.S. economy.
