US Services Activity Accelerates

2026-06-03 14:04 By Joana Taborda 1 min. read

The ISM Services PMI increased to 54.5 in May 2026 from 53.6 in April, above forecasts of 53.8.

The reading pointed to the strongest gain in the services sector in three months, with faster growth seen for business activity (57.7 vs 55.9), new orders (57.3 vs 53.5) and inventories (62.5 vs 53.1).

On the other hand, employment contracted for a third consecutive month (47.9 vs 48), with respondents commenting frequently that their companies had instituted hiring freezes or were not back filling vacated positions.

In addition, price pressures intensified to hit the highest since August 2022 (71.3 vs 70.7), with diesel, gasoline, oil and related commodities being once again most frequently mentioned as up in price.

Also, petroleum-related products were mentioned as a commodity up in price, a dynamic not seen yet in April.

Meanwhile, growth in backlog of orders slowed (51.3 vs 53) and the supplier deliveries index indicated slower supplier delivery performance (55.2 vs 56.8).



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US Services Activity Accelerates
The ISM Services PMI increased to 54.5 in May 2026 from 53.6 in April, above forecasts of 53.8. The reading pointed to the strongest gain in the services sector in three months, with faster growth seen for business activity (57.7 vs 55.9), new orders (57.3 vs 53.5) and inventories (62.5 vs 53.1). On the other hand, employment contracted for a third consecutive month (47.9 vs 48), with respondents commenting frequently that their companies had instituted hiring freezes or were not back filling vacated positions. In addition, price pressures intensified to hit the highest since August 2022 (71.3 vs 70.7), with diesel, gasoline, oil and related commodities being once again most frequently mentioned as up in price. Also, petroleum-related products were mentioned as a commodity up in price, a dynamic not seen yet in April. Meanwhile, growth in backlog of orders slowed (51.3 vs 53) and the supplier deliveries index indicated slower supplier delivery performance (55.2 vs 56.8).
2026-06-03
US Services Activity Inches Down as Expected
The ISM Services PMI inched down to 53.6 in April of 2026 from 54 in the previous month, loosely aligned with market expectations of 53.7, but remained firmly above averages from the previous year. Business activity rose by 2 points to 55.9, reflecting a second month of resilience since the start of war in the Middle East, which triggered a surge in a energy costs. The increase in production was due to a drop in the backlog of orders (-0.6 to 53) as the gauge for new orders sank 7.1 points to 53.5, the sharpest decrease in three years. Consumers volume orders were dented due to the surge in prices since the start of the war, dimming the outlook on production should the conflict continue. Consistently, the price gauge held at 70.7, the highest since 2022. Companies cited higher fuel, gasoline, diesel, copper, and freight prices due to the war. On top of that, aluminum prices and lumber costs also jumped due to tariffs. Meanwhile, employment contracted for a second month.
2026-05-05
US Services Sector Slows in March
The ISM Services PMI fell to 54 in March 2026 from 56.1 in February which was the highest since August 2022 and compared to forecasts of 55. The reading pointed to a slowdown in services activity, led by an ease in business activity (53.9 vs 59.9) and the first drop in employment in four months (45.2 vs 51.8). Also, the prices index rose to 70.7, the highest since October 2022 from 63 in February, amid higher oil and fuel costs and the supplier deliveries index indicated slower performance compared to February (56.2 vs 53.9), also unsurprisingly with shipping issues and flight disruptions due to the Middle East conflict and winter weather. Meanwhile, inventories (54.8 vs 56.4) and order backlogs (53.6 vs 55.9) eased while new orders rose faster (60.6 vs 58.6). "The predominant commentary this month was about impacts and adjustments due to the conflict with Iran and the expected flow through of higher oil prices at some point", Steve Miller, Chair of the ISM said.
2026-04-06