- POSTED: 05 Aug 2014 23:41
- UPDATED: 06 Aug 2014 02:28
Activity in the US services sector jumped in July, with virtually all non-manufacturing industries experiencing growth, the latest sign of building momentum in the American economy.
WASHINGTON: Activity in the US services sector jumped in July, with virtually all non-manufacturing industries experiencing growth, the latest sign of building momentum in the American economy.
The Institute for Supply Management said on Tuesday (August 5) that its non-manufacturing purchasing managers index jumped 2.7 points, to 58.7 last month - a larger increase than analysts expected. Sixteen of 17 industries in the services sector, the driver of the US economy, notched increases, said the PMI report, which analysts said was the best since 2005.
"Conditions are improving," according to one survey participant in the construction industry. "Business is still very good," said a supply manager in retail trade. "Expecting continued growth in the second half of the year."
The report is the latest to indicate that the US economy continued to strengthen in the second quarter after a soft first quarter blamed on extreme cold weather.
Last week, the US government said the economy grew by a robust 4.0 percent in the second quarter and that it has generated at least 200,000 jobs per month since February. A reading over 50 in the PMI report indicates growth. It has now shown growth for the 54th straight month.
The report said 16 industries reported growth in July, including construction, real estate, retail trade, accommodation and food services, and management of companies. The only sector to contract was utilities.
The report indicated growth in business activity, new orders and employment. However, the prices index dropped by 0.3 of a point from the June level to 60.9. Economist Jim O'Sullivan of High Frequency Economics said the report was "much stronger than expected, adding to the growing list of data showing a net pick-up in the trend in growth this year."