ISM Shows Services Economy Growing At Slower Pace In March
April 4, 2012 by Jon C. Ogg
The Institute for Supply Management is out with its latest report on the services economy. The non-manufacturing data for the month of March 2012 showed that economic activity in the non-manufacturing sector posted its 27th consecutive month of gains. The Non-Manufacturing ISM Report On Business was down 1.3 points from the February report with a reading of 56.0%. This still represent growth, but Bloomberg had estimates pegged at 57.0 and Dow Jones had a consensus of 56.9 for March.
Today’s report shows continued growth, albeit at a slower pace than the prior month. The Business Activity Index was down 3.7 points to 58.9% in March; and the New Orders Index fell by 2.4 points to 58.8%; and the Employment Index was actually up 1 full point to 56.7%.
Inflation hawks may be losing some of the argument here as the Prices Index fell by 4.5 points down to 63.9%. That is still higher in prices, but at a slower rate. It is interesting that the report noted that there remains a concern about cost pressures and the instability of fuel prices.
The NMI reported that 16 non-manufacturing industries reported growth in March and the comments from the respondents remained mostly optimistic about business conditions with a higher confidence level of businesses and consumers.
JON C. OGG
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