US services sector contracts in May for 2nd time in past 3 months

ISTANBUL

Economic activity in the US services sector fell in June for the second time in the last three months, according to a survey report Wednesday by the Institute for Supply Management (ISM).

The ISM's non-manufacturing purchasing managers’ index (PMI), also known as the ISM services PMI, came in at 48.8%, down five percentage points from the previous month's 53.8%, and coming in below market expectations of 52.6%.

The services sector in the world's biggest economy contracted in May for the third time in 49 months, also in April 2024 and December 2022, since a reading above 50 indicates growth and below that shows contraction.

ISM Chair Steve Miller said survey respondents report that business is flat or lower in general and added: "Although inflation is easing, some commodities have significantly higher costs."