US Services Sector Records Fastest Growth in Over a Year

US services sector activity recorded its fastest growth in more than a year last month, signaling stronger demand and improved performance among service-oriented businesses.

The Institute for Supply Management reported that the Services PMI rose to 54.5, up 1.8 points from the previous month, marking its highest level since October 2024 and exceeding market expectations.

A reading above 50 indicates expansion, and the data showed a sharp acceleration in new orders, which posted their strongest growth since September 2024, reinforcing US services sector activity.

The sector’s business activity index climbed to its highest level in a year, while export orders increased at their fastest pace in over a year, reflecting stronger external demand.

The rebound in demand also supported the strongest employment growth in the services sector since February, further underpinning the positive outlook for US services sector activity.

Markets are now awaiting the government’s monthly jobs report, which is expected to show moderate wage growth and a decline in the unemployment rate.