US Services Industry grows at slower pace in May, as ISM index registered 60.1

$5.4 trillion

The services component of US personal consumption expenditure in the first quarter of 2006

The services sector of the U.S. economy expanded at a slower pace in May, according to ISM's non-manufacturing business activity index which registered 60.1% in May, down from 63% in April. 

The service sector accounts for two-thirds of the U.S. economy. A reading of 50 and above points to a growth, while a figure below 50 signals contraction.

The survey by the Institute for Supply Management indicated several concerns: 
  • "Concern about rising fuel cost." (Communication)
  • "High energy cost and interest rates affect savings and loans." (Finance & Banking)
  • "Level of business activity, sales pipeline is starting to increase." (Insurance)
  • "Coal mining sales remain very high and should hold for long term." (Mining)
  • "Energy continues to have a negative impact on goods and services, specifically transportation costs."(Retail Trade)
  • "Beginning to see price increase requests due to oil, copper [and] other metals increasing." (Wholesale Trade)

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