US service sector growth strong in October but inflation slips, Markit says
The rate of growth in the US services sector was "strong" but steady in October, according to the results of a widely-followed survey.
IHS Markit's service sector purchasing managers' index for October was unchanged at 55.3, which the survey compiler said was "slightly faster" than the long-run series average.
However, the rate of growth in new business orders eased to a six-month low as did the pace of increases in average prices charged.
In parallel, backlog accumulation softened to a four-month low, although IHS Markit said hiring continued at a "solid" pace with companies linking that to "greater business requirements and rising client demand".
Chris Williamson, chief business economist at IHS Markit, said: "The services PMI survey highlights the dilemma facing the Fed as it seeks to determine the right policy course amid signs of solid growth but soft inflation.
"[...] With the data for October setting the scene for another robust GDP increase in the fourth quarter, a December rate hike is very much on the cards.
"However, a drop in inflationary pressures adds an element uncertainty to the picture. Having been buoyed by supply chain disruptions in prior months, input cost pressures eased at the start of the fourth quarter, and the rate of increase of average prices charged for goods and services dropped markedly."