ISM Services Index Surprises To The Upside – Real Time Insight

Surprise! The ISM Non-Manufacturing Index defied the consensus by rising to 52.6 in July from 52.1 in June. The consensus was looking for no change. It reversed last month's downward trajectory.

The last 3 months doesn't show any pattern, however:

• May: 53.7
• June: 52.1
• July: 52.6

Before today's number, the index had averaged 53.4 since the Great Recession officially ended in June 2009.

The sub indexes continued to paint a mixed economic picture.

New orders rose to 54.3 from an 8-month low in June of 53.3.

But employment skidded under 50 for the first time in months, falling to 49.3. That's obviously not the direction you want to see the employment sub index headed.

• April: 54.2
• May: 50.8
• June: 52.3
• July: 49.3

The service sector is 90% of the economy.

Does today's report, combined with the better-than-expected jobs report, put recession fears on the back burner?

 

 
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