Economy

Economic Data Roundup (06/06/2016)

6/6/16 12:00 PM

iStock_000009946822_Small.jpgThere are two reports on the U.S. economy worth mentioning today. First, the services sector purchasing managers' index (PMI) from Markit Economics ended May at 51.3, down from the year-to-date high hit in April and still well below the average (55.6) pace of activity expansion for the recovery. Measures of new business growth, job creation, and general optimism all deteriorated last month, and many surveyed managers blamed weak spending patterns among clients, subdued underlying economic conditions, and heightened uncertainty related to the presidential election cycle. Similarly, the Institute for Supply Management’s (ISM’s) non-manufacturing index fell to 52.9 in May, significantly worse than expected and the weakest headline reading since February 2014. While this was the 76th consecutive month of overall activity expansion (>50 reading) in this sector, measures of new orders, production, and employment all declined last month and the price index (inflation) rose. Comments from surveyed managers can be found here. Markit's chief economist Chris Williamson added that these disappointing service sector numbers, combined with the continued downturn seen in U.S. manufacturing, "point to GDP growing at an annualized rate of just 0.7-0.8% in the second quarter, notwithstanding any marked change in June.”

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Sources: Econoday, Twitter, DShort, Bloomberg, ZH, Markit Economics, ISM, FRBSL

Post author: Charles Couch