The ISM services index was this week’s primary US economic release. The headline number rose 1.1 to 54.5. Production and new orders increased and the employment index rose above 50, indicating expansion. While the anecdotal comments were generally positive, they contained some negative points:
“Nationally, business seems stronger than a year ago in Q1. Internal volume is better than expected and vendors report stronger Q1 than expected.” (Management of Companies & Support Services)
“[Business] conditions are moving at a slow, but positive pace in this market. Expansion efforts are back on the horizon for late 2016.” (Finance & Insurance)
“Macroeconomics, the world oil glut, Fed interest rates, foreign currencies in trouble, the slowing Chinese economy and a strong dollar will continue to place pressure on U.S. exports, especially food commodities. These situations have created lower domestic wholesale prices and lower hotel COGS [Cost of Goods Sold]; a win for us.” (Accommodation & Food Services)
“Stability/dependability of revenue sources and cost of healthcare continue to be drivers in government revenues and expenditures.” (Public Administration)
“Similar to last month, our company continues to look for ways to invest in lowering prices to attract cost-conscious consumers in a highly competitive grocery retail environment.” (Retail Trade)
“No new business, but existing business is up 5 percent month-over-month and 40 percent year-over-year, especially in our e-commerce fulfillment services. Subsequent purchasing is relatively flat as productivity improvements are creating more capacity with less incremental cost.” (Transportation & Warehousing)
“Lower volumes than expected at the start of the year.” (Arts, Entertainment & Recreation)
“Business remains the same with an increase in hiring.” (Information)
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