The June ISM Services Index came in at 54.0, in line with expectations and down slightly from May’s 54.5, according to the Institute for Supply Management. A value above 50 reflects expansion in the services sector, while a value below 50 indicates contraction. The New Orders Index registered 55.1, down modestly from May’s 57.3. The Employment Index edged up to 51.2, an increase from 47.9 in May and moved above the 50 threshold, indicating expansion in service-sector employment. Prices Paid declined to 67.7, down from 71.3 in May, suggesting cost pressures eased somewhat but remain elevated.
The ABA Office of the Chief Economist believes the June data points to continued resilience in the services sector, which remains a key driver of U.S. economic activity. For banks, continued growth in services and expansion in employment should support commercial and industrial lending, particularly among service-oriented small and midsize businesses. Additionally, expansion in the services industries employment may help sustain consumer spending and demand for credit.
