Growth in the all-important US services sector picked up sharply in September, providing further evidence that the recent string of hurricanes that battered swathe of southeastern US is unlikely to have a significant impact on US third quarter growth.
The Institute for Supply Management’s non-manufacturing gauge came in at 59.8 last month – the highest reading since August 2005. It is a sharp leg up from the reading of 55.3 recorded in August and easily trounced expectations for it to dip to 55.1.
Readings above 50 point to expansion, while those below indicate contraction.
The services sector, which includes professional services, healthcare and other non-manufacturing industries, makes up about 80 per cent of US gross domestic product.
The report comes just days after another ISM survey showed US manufacturing activity grew at its fastest pace in more than 13 years in September and reinforces the view in the market that US economic recovery remains on course for the second half of the year.
That is from Pan Kwan Yuk at the FT, file under “The Show So Far.”