Services PMI Remains Weak, Markit Chief Economist Estimates 1% GDP Growth

By: Mike Shedlock | Mon, Jun 27, 2016
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The Markit Services PMI report shows service sector growth remains subdued in June. Data is from June 13 to 24.

The diffusion index reading for June is 51.3, nearly identical to the May reading of 51.2. Any reading above 50 shows expansion.

Employment expands at the slowest pace for a year-and-a-half.


Key Points

Reports from survey respondents suggested that relatively subdued demand continued to weigh on activity growth in June, reflecting heightened economic uncertainty and risk aversion among clients. Latest data signalled only a moderate increase in new business volumes, although the pace of expansion picked up slightly since May and was the strongest for five months.

Staffing levels increased across the service economy in June. However, the rate of job creation eased for the third month running and was the slowest since December 2014. Softer employment growth in part reflected a lack of pressure on operating capacity at service sector firms, as highlighted by a sustained reduction in unfinished work during June.

Meanwhile, input cost inflation remained subdued and slowed to its weakest since March. This in turn acted as a brake on output charge inflation across the service sector, which remained marginal and eased since the previous month.

Markit US Services PMI


Comments From Chris Williamson, Markit Chief Economist

 


 

Mike Shedlock

Author: Mike Shedlock

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Michael "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Visit http://www.sitkapacific.com/ to learn more about wealth management for investors seeking strong performance with low volatility.

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