US service sector growth accelerates in October, ISM says
The most widely-followed gauge for services sector activity in the States held up better-than-expected last month, albeit slight softness in two gauges linked to order levels.
The Institute for Supply Management's purchasing managers' index edged up from a reading of 59.8 for September to print at 60.1 in October.
Economists had anticipated a dip to 58.0.
However, perhaps the key sub-index contained in that report, which tracks new orders, slipped by 0.2 points to 62.8.
For all of the PMI's indices the 50-point level marked the threshold between expansion and contraction, with readings successively above or below that mark denoting faster rates of growth or contraction, respectively.
In parallel, the sub-index linked to firms' order backlogs fell by 2.5 points to 53.5, although the sub-index for export orders improved by 4.0 points to 60.0.
According to the ISM, the past correlation between the PMI and the rate of growth in US gross domestic product indicated that the economy grew at a clip of 4.3% in October.
To take note of, the employment sub-index strengthened by a further 0.7 points to 57.5, which Ian Shepherdson at Pantheon Macroeconomics said was consistent with monthly non-farm payrolls growth of roughly 300,000.
"The index usually just tracks the rate of growth of core retail sales, but it overshot in September and we expected a correction in October. Instead, it rose even further. This might be hurricane-related - auto dealers presumably are pretty happy - or it might be sign that the official retail sales numbers need to be revised up; either way, it looks spectacularly strong."