All articles tagged with #service sector
Economist Diane Swonk warns that despite positive market signals and slowing inflation, the economy's true health is fragile, with only the wealthy feeling confident due to persistent inflation in the service sector and a growing divide between high- and low-income consumers, indicating underlying vulnerabilities.
UK inflation rose to 3.8% in July, the highest in 18 months, driven by service sector inflation and rising utility and transport costs, making it the fastest among G7 economies. The Bank of England signaled a cautious approach to interest rate cuts amid persistent inflation pressures, which are expected to remain above target until mid-2027.
The July 2025 Services PMI® was 50.1%, indicating slight expansion in the U.S. service sector for the second consecutive month, with mixed signals such as contraction in employment and increased prices, reflecting slow growth and ongoing impacts from tariffs and global trade tensions.
The May 2025 Services PMI® fell to 49.9%, indicating a slight contraction in the U.S. services sector for the first time since June 2024, driven by declines in new orders and inventories, while employment and supplier deliveries showed signs of recovery amid rising prices and ongoing tariff uncertainties.
The Nasdaq 100 reached record highs, driven by strong service sector growth and gains in tech and semiconductor stocks. The S&P 500 and small caps also rallied, while commodities rebounded. The Bank of Canada cut interest rates as inflation slowed.
The ADP jobs report for August showed an increase of 177,000 jobs, falling short of the expected 200,000 and a significant drop from July's revised figure of 371,000. Annual pay growth also slowed to 5.9% from 6.2% in July. The report suggests a shift towards more sustainable job and pay growth as the economy recovers from the pandemic, with the service sector leading job gains and manufacturing adding 12,000 jobs.
The S&P Global "flash" US service sector activity index fell to 54.1 in June, while the manufacturing sector index slid to 46.3, indicating contraction. New orders in the services sector increased at a strong rate, while manufacturers recorded the fastest rate of contraction in new orders since last December. Inflation was seen as moderating, and the overall rate of selling prices for goods and services dropped to the lowest level since late 2020. S&P Global predicts that the US economy is running close to a 2% growth rate in the second quarter.
Gold prices have risen as the US service sector activity fell more than expected in May, according to the Institute for Supply Management (ISM). The ISM said its Services Purchasing Managers Index fell to 50.3% last month, down from April's reading of 51.9%. The gold market has seen a solid bounce off of support just above $1,950 an ounce, and the disappointing economic data is providing new momentum. Analysts have said that gold is seeing new momentum as the disappointing economic data could force the Federal Reserve to end its interest rate hikes.
Gold prices edged up after the preliminary manufacturing and service-sector sentiment data were released for May. While the US manufacturing PMI fell to 48.5, the service sector expanded with the PMI reading rising to 55.1. The US economy continued to expand in May, led by the service sector, but the manufacturing sector is struggling with over-filled warehouses and a dearth of new orders. The service sector is hiking prices, which puts upward pressure on problematic inflation.
US business activity unexpectedly climbed this month to nearly a one-year high, bolstered by stronger services and manufacturing that threatens to reignite inflationary pressures. The S&P Global flash April composite purchasing managers index rose 1.2 points to 53.5 - the highest since May - the group reported Friday. Firms saw new orders jump to the highest rate in 11 months, especially in the service sector. That allowed businesses to pass on higher costs to customers, resulting in the fastest jump in output prices in seven months. An uptick in inflation would reverse months of progress, even though price growth is still too fast.
Gold prices have fallen below $2,000 an ounce due to stronger-than-expected manufacturing and service sector data, which indicates economic growth. The S&P Global Flash U.S. manufacturing PMI data rose to 50.4, up from March's reading of 49.2, while activity in the service sector rose further into expansion territory to 53.7. The increase in economic activity is being led by the service sector, but inflation threatens to be embedded in the economy.
Japanese manufacturers' sentiment has worsened to its lowest level in over two years, while the service sector has seen an uptick in mood, according to the latest Tankan survey. The survey also showed that corporate inflation expectations hit a fresh high, with firms projecting inflation to stay above the Bank of Japan's 2% target for five years ahead. The data highlights the challenge facing incoming Bank of Japan Governor Kazuo Ueda in deciding when to phase out his predecessor's massive stimulus programme, as slowing global growth could derail the export-reliant recovery.