US Service Sector Hits 8-Month High in October

US Service Activity Records the Largest Increase in 8 Months

The US ISM (Institute for Supply Management) has announced the service sector PMI data for October. According to the data, the service sector PMI index increased by 2.4 points in October compared to the previous month, reaching 52.4. This value exceeded market expectations, which were at 50.7.

Signs of Growth in the Sector

The increase in October indicates that there is growth in the sector. In the previous month - September - the PMI index remained stable at 50. Let's take a closer look at the details of this growth in the service sector, one of the cornerstones of the economy:

• Production index: Increased by 4.4 points month-on-month, reaching 54.3.
• New orders: Increased by 5.8 points, reaching 56.2.
• Employment index: Increased by 1 point, recorded at 48.2.

While growth was observed in 11 sub-sectors of the service sector, only 6 sub-sectors recorded contraction. The sectors that experienced growth include:

• Accommodation and food services
• Retail trade
• Wholesale trade
• Real estate and leasing
• Health services
• Transportation and warehousing

Among the areas where contraction was observed are sectors such as arts, entertainment, and recreation and finance and insurance.

S&P Global Service Sector Data

Additionally, S&P Global also announced the final service sector PMI data for October. The service sector PMI rose by 0.6 points to 54.8 in October. The previous preliminary data was recorded at 55.2. In September, the PMI value was recorded at 54.2.

The composite PMI, which encompasses both manufacturing and service sectors, also increased by 0.7 points in October, reaching 54.6. This value was above market expectations.

In summary, ISM and PMI values above 50 indicate expansion, while values below 50 indicate contraction.