The ISM Services Index increased 2.6 percentage points (pp) to 51.4%.
“Ten industries reported growth in July. The Services PMI has expanded in 17 of the last 19 months dating back to January 2023, and the July reading is only 0.9 percentage point lower than the average of 52.3 percent over that period of time. Also, the PMI® has not recorded back-to-back months in contraction since April and May 2020, another indication of sustained growth for the sector,” said Steve Miller, CPSM, CSCP, chair of the Institute for Supply Management Services Business Survey Committee.
The Business Activity Index registered 54.5%, which is 4.9 pp higher than the 49.6% recorded in June and a return to expansion after one month of contraction. The Supplier Deliveries index registered 47.6%, 4.6 pp lower than the 52.5% recorded in June. (A reading of below 50% indicates faster deliveries). The Prices Index registered 57.0% in July; a 0.7 pp increase from June’s reading of 56.3%. Respondents commented: “High food costs are having an impact on customer demand and resulting in flat business overall. Business activity stable. Supplier costs also flat in general.”
The Inventories Index contracted for the second consecutive month in July, registering at 49.8%, an increase of 6.9 pp from June’s figure of 42.9% and the Employment Index registered at 51.1%, a 5.0 pp increase compared to the 46.1% recorded in June. Respondents commented: “Business in 2024 has been steady. The length of our busy season — typically March to mid-June — has extended into mid-July. Volumes have not increased considerably, but the consistency of shipments has been a benefit to our supply chain.” (Agriculture, Forestry, Fishing & Hunting)
The Inventory Sentiment Index expanded for the 15th consecutive month, registering 63.2%, down 0.9% from June’s reading of 64.1%. This reading indicates that respondents feel their inventories are too high when correlated to business activity levels.
Read the ISM release.
