The ISM Non-Manufacturing PMI index for the United States fell to 57.6 in December of 2018 from 60.7 in November and below market expectations of 59. The reading pointed to the weakest expansion in the services sector in five months, amid a slowdown in business activity, employment, inventories and supplier deliveries.
A slowdown was seen in business activity (59.9 from 65.2), employment (56.3 from 58.4), inventories (51.5 from 57.5) and supplier deliveries (51.5 from 56.5). On the other hand, faster increases were recorded for new orders (62.7 from 62.5) and new export orders (59.5 from 57.5). The price pressue eased (57.6 percent from 64.3 percent) but still signalled 34th consecutive month of growth.
The 16 non-manufacturing industries reporting growth in December listed in order are: Arts, Entertainment & Recreation; Transportation & Warehousing; Health Care & Social Assistance; Retail Trade; Information; Utilities; Accommodation & Food Services; Professional, Scientific & Technical Services; Public Administration; Other Services; Finance & Insurance; Wholesale Trade; Agriculture, Forestry, Fishing & Hunting; Educational Services; Construction; and Management of Companies & Support Services. The only industry reporting a decrease in December is Mining.
Respondents also indicated that there is still concern about tariffs despite the hold on increases by the US and China and that capacity constraints have lessened while employment-resource challenges remain. Respondents are mostly optimistic about overall business conditions.
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