The U.S. services sector expanded at a slightly faster pace in February as the non-manufacturing business activity composite index was 56.9 in the month, compared to 56.7 in January, on a seasonally adjusted basis, the Institute for Supply Management reported Wednesday.
Economists polled by Thomson Reuters had expected a 56.5 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index climbed to 49.7 from 45.5.
The employment index increased to 56.4 from 51.6.
The business activity/production index slid to 59.4 from 61.5, the new orders index was at 56.7, down from 59.5; backlog of orders rose to 53.0 from 49.0; new export orders gained to 53.5 from 52.5; inventories increased to 54.5 from 52.5; inventory sentiment gained to 62.0 from 61.5; the supplier deliveries index rose to 55.0 from 54.0; and imports grew to 51.0 from 46.5.
Members' general comments on business in the month included:
"The lower price of oil is providing a beneficial impact on certain products, specifically plastics." (Agriculture, Forestry, Fishing & Hunting)
"Business conditions are seeing less money being spent on capital projects by the major oil companies." (Construction)
"Business is on par or slightly up for this time of year. This time of year is considerably slower than peak season." (Arts, Entertainment & Recreation)
"West Coast ports are causing shortages." (Health Care & Social Assistance)
"Signs of continued, but slowed growth in our sector. Low fuel prices and utility prices helping with costs. International markets remain lagging behind US growth." (Professional, Scientific & Technical Services)
"The West Coast port labor union situation is slowing down the products we need to release to our customers. Business is good, but waiting and not shipping on time will cost us big time." (Information)
"Sales continue to be solid which is believed to align with lower fuel costs and overall consumer sentiment being positive." (Retail Trade)
"Port congestion is causing major delays in the delivery of product. The reduced cost of fuel has increased our sales and we believe it will continue throughout the first quarter." (Wholesale Trade)
