Activity in the U.S. service sector grew at a slower than expected rate in the month of November, the Institute for Supply Management revealed in a report released on Tuesday.
The ISM said its non-manufacturing index dropped to 57.4 in November from 60.1 in October, although a reading above 50 still indicates growth in the service sector. Economists had expected the index to dip to 59.0.
"The rate of growth has lessened in the non-manufacturing sector after two very strong months of growth," said Anthony Nieves, Chair of the ISM Non-Manufacturing Business Survey Committee.
He added, "Comments from the survey respondents indicate that the economy and sector will continue to grow for the remainder of the year."
The bigger than expected decrease by the non-manufacturing index was partly due to a notable slowdown in the pace of new orders growth, with the new orders index tumbling to 58.7 in November from 62.8 in October.
The employment index also slid to 55.3 in November from 57.5 in October, indicating a slowdown in the pace of job growth in the service sector.
On the inflation front, the report said the prices index fell to 60.7 in November from 62.7 in October but still suggested price growth.
The ISM released a separate report last Friday showing a modest slowdown in the pace of growth in manufacturing activity in the month of November.
The purchasing managers index dipped to 58.2 in November from 58.7 in October. Economists had expected the index to edge down to 58.4.
by RTT Staff Writer
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