July's Service Sector Activity

The United States' service sector experienced a slight deceleration in July, as indicated by the Services Purchasing Managers' Index (PMI) dropping from June's 50.8% to 50.1%. Despite this dip, the sector remains in the expansion territory, according to the latest report from the Institute for Supply Management (ISM).

Key Index Movements

Notable changes include the New Orders Index decreasing by 1 percentage point to 50.3%, and the Business Activity Index falling by 1.6 percentage points to 52.6%. The Inventory Sentiment Index also saw a decline of 3.9 percentage points but stayed in expansion at 53.2%. Conversely, the Employment Index continued its contraction, slipping by 0.8 percentage points to 46.4%.

Expert Insights

"July’s PMI level indicates ongoing slow growth, with respondents citing seasonal and weather factors as negative influences. The persistent contraction in the Employment Index and the accelerated expansion of the Prices Index are concerning trends," remarked Steve Miller, Chair of the ISM Services Business Survey Committee.