Service industries grew in September, capping the strongest quarter of expansion in more than 10 years for the biggest part of the U.S. economy.
While the Institute for Supply Management’s non-manufacturing index fell to 58.6 from the prior month’s 59.6, the third-quarter average was the highest since the first three months of 2004, a report from the Tempe, Arizona-based group showed today. Readings above 50 signal expansion. The median forecast of 78 economists surveyed by Bloomberg called for 58.5.
More hiring and stock-market gains are boosting Americans’ wealth and encouraging them to keep spending. Advances in service industries — which account for about 90 percent of the economy — combined with manufacturing growth bode well for the world’s largest economy that’s now in its sixth year of expansion.
For the ISM index, estimates in the Bloomberg survey ranged from 56 to 60.2. The measure averaged 59 from July through last month and compares with 54.7 in 2013.
The ISM non-manufacturing survey covers an array of industries including utilities, retailing, and health care and also factors in construction and agriculture.
The gauge of services employment increased to 58.5, the highest since August 2005, from 57.1 the prior month. The index was corroborated today by a Labor Department report that showed more signs of vigor in the U.S. job market.
Source : Bloomberg