US service sector activity rebounded strongly in January, with new orders picking up and prices paid by companies for materials continuing to rise at a moderate pace, positive signs for the economy.
The Institute of Supply Management (ISM) said on Friday (3) that its non-manufacturing PMI rose to 55.2 last month. The Index fell to 49.2 in December, going below the 50 level, which signals contraction, for the first time since May 2020.
Economists polled by Reuters had forecast the non-manufacturing PMI to rise to 50.4.
The services sector, which accounts for more than two-thirds of US economic activity, is benefiting as consumers shift from spending on goods to services.
Demand for goods, which are normally bought on credit, has been reduced by the Federal Reserve’s fastest rate hike cycle since the 1980s.
The ISM said on Wednesday that its manufacturing PMI contracted for a third straight month in January.
The ISM indicator of new orders received by service companies increased to 60.4 in January from 45.2 in December.
A measure of prices paid by service industries for inputs fell to 67.8 from 68.1 in December as supply bottlenecks continued to ease.
Source: CNN Brasil
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