US ISM Services PMI dropped from 55.1 to 51.2 in March, below expectation of 54.5. Looking at some details, business activity/production dropped from 56.3 to 55.4. New orders tumbled sharply from 62.6 to 52.2. New export orders dived from 61.7 to 43.7. Employment dropped from 54.0 to 51.3. Prices dropped from 65.6 to 59.5.
Anthony Nieves, Chair of ISM Services Business Survey Committee: “There has been a pullback in the rate of growth for the services sector, attributed mainly to (1) a cooling off in the new orders growth rate, (2) an employment environment that varies by industry and (3) continued improvements in capacity and logistics, a positive impact on supplier performance. The majority of respondents report a positive outlook on business conditions.”
“The past relationship between the Services PMI and the overall economy indicates that the Services PMI for March (51.2 percent) corresponds to a 0.5-percent increase in real gross domestic product (GDP) on an annualized basis.”
