US service sector growth slowest in five months
US services sector growth hit a five-month low in December, according to the Institute of Supply and Management
US ISM data showed on Monday, its non-manufacturing activity index fell to the lowest reading since July.
The index fell to 57.6 in December, from 60.7 in November missing expectations.
Analysts forecast a December reading of 59.0, slightly higher than recorded. Analysts say that the drop in the industry was somewhat expected, after seeing declines in business surveys.
Dollar falls upon weak PMI
Stocks on Wall Street were trading higher while US Treasury prices were lower and the dollar fell upon the data.
The fall was also pressured by growing concerns over the Federal Reserve and their monetary policy, which is expected to either pause or halt its interest rate hikes.
The ISM also noted that despite on-going monetary policy tightening from the Fed the sector is still solid and the economy is in good shape.
The ISM said that trade tensions between the US and China remained a major concern for business.
The economy grew at a 3.4% pace in the third quarter, while growth estimates for the fourth quarter coming in at around 2.6%.
Services industries employment fell to 56.3 in December, the lowest since July.
The ISM non-manufacturing index shows business conditions in the US non-manufacturing sector, which constitutes the largest sector of the US economy.
Live prices on most popular markets
You might be interested in…
Find out what charges your trades could incur with our transparent fee structure.
Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.
Stay on top of upcoming market-moving events with our customisable economic calendar.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.