The ISM Services Index edged up 0.1 percentage points (points) to 51.5%.
“Ten industries reported growth in August. The Services PMI® has expanded in 18 of the last 20 months dating back to January 2023, and the August reading is equal to the 51.5 percent index average for 2024.” Also, the increase in the Services PMI® in August is due to all directly factoring indexes (Business Activity, New Orders, Employment and Supplier Deliveries) with readings close to or above 50 percent, said Steve Miller, CPSM, CSCP, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee.
The Business Activity Index registered 53.3%, which is 1.2 points lower than the 54.5% recorded in July and a indicated continuing expansion after one month of contraction in June. The Supplier Deliveries Index registered 49.6%, 2 points higher than the 47.6 percent recorded in July. (A reading of below 50 percent indicates faster deliveries). The Prices Index registered 57.3% in August, a 0.3 point increase from July’s reading of 57%. Respondents commented: “High food costs are impacting customer demand, and weak sales performance has resulted in negative growth overall. Business activity is stable, and supplier costs are generally flat.” (Wholesale Trade)
The Inventories Index returned to expansion territory after two consecutive months of contraction. The index registered at 52.9%, an increase of 3.1 points from July figure of 49.8% and the Employment Index registered at 50.2%, 0.9 points decrease compared to the 51.1% recorded in July. Respondents commented: “Generally, business is good. However, there are concerns of slowing foot traffic at restaurants and other venues where our products are sold.” (Agriculture, Forestry, Fishing & Hunting)
The Inventory Sentiment Index expanded for the 16th consecutive month, registering 54.9%, down 8.3% from July’s reading of 63.2%. This reading indicates that respondents feel their inventories are too high when correlated to business activity levels.
Read the ISM release.
