US: ISM services index rises to 56.9 in august

For now, US economic activity is still expanding. The ISM services index, which was expected to decline from 56.7 to 55.3, rose to 56.9 in august.

If we look at the sub-items; The activity index reached 60.9, an increase of 1 point compared to July's reading of 59.9. The new orders index of 61.8 is 1.9 points higher than the July reading of 59.9. Employment data for August showed that hiring in the services sector remained solid overall, but the pace slowed towards the middle of the year. In this report, the employment index seems to have increased from 49.1 to 50.2.

Improvement in business activity and new orders led to an increase in the July ISM services index, which continued to be positive in August in an economy where recession possibilities were discussed. Normally, the ISM services report covers a wide range of industries with an uneven growth rate among them. Therefore, there may still be significant slowdown potential in some areas of the service sector. However, rising mortgage rates hit real estate activity and construction, while falling consumer demand could indicate growth in industries such as retail and shipping and warehousing has slowed sharply.

In terms of the Fed; Since the economy has not yet exhibited recession practices and the service sector is a good indicator in terms of the area it occupies in the economy and being affected by demand, there seems to be no reason to slow down the rate hikes.

Kaynak:Tera Yatırım-Enver Erkan
Hibya Haber Ajansı