US Services Activity Expands at Slowest Pace in Three Months
US services activity expanded in November at the slowest pace in three months as demand and employment growth settled back, indicating the largest part of the economy is losing momentum.
The Institute for Supply Management’s index of services dropped 3.9 points, the first decline since June, to 52.1 last month, the group said Wednesday. While readings above 50 indicate expansion, the latest figure was weaker than all projections in a Bloomberg survey of economists.
The group's new orders gauge decreased 3.7 points to a three-month low of 53.7. A measure of business activity, which parallels the ISM's factory output gauge, also fell to the lowest level since August.
Combined with data earlier this week showing an eighth straight month of contraction in manufacturing, the services survey suggests moderating economic growth in the final stretch of 2024.
The easing of business activity, along with a fourth month of declining backlog orders and a slide in export demand, led to a tempering of employment growth at service providers. The ISM measure slipped 1.5 points to 51.5 last month.
Amid the moderation in demand, supplier delivery times also quickened, with the group's gauge slipping back below 50.
Meanwhile, the index of prices paid for materials and services edged higher in a sign services continue to contend with elevated cost pressures.
Source: Bloomberg
