A survey released on Wednesday by The Institute of Supply Management [ISM] shows non-manufacturing business activity increased 0.3 bps in May to an index [NMI] reading of 44% from 43.7% registered in April. The increase in NMI was marginal compared to the street consensus of economists who on average were expecting an increase to 46%. According to ISM business worsened in May in the non-manufacturing sectors of the U.S. economy for the eighth consecutive month.
From ISM: “The NMI (Non-Manufacturing Index) registered 44 percent in May….indicating contraction in the non-manufacturing sector…but at a slightly slower rate. The Non-Manufacturing Business Activity Index decreased 2.8 percentage points to 42.4 percent. The New Orders Index decreased 2.6 percentage points to 44.4 percent, and the Employment Index increased 2 percentage points to 39 percent. The Prices Index increased 6.9 percentage points to 46.9 percent in May, indicating a slower decrease in prices from April.
According to the NMI, six non-manufacturing industries reported growth in May. Respondents’ comments remain mixed and vary by industry and company. Some respondents indicate that there are signs of stabilization, while others continue to have a negative outlook on the economy.”