The U.S. services sector expanded at a faster pace in June as the non-manufacturing business activity composite index was 56.0 in the month, compared to 55.7 in May, on a seasonally adjusted basis, the Institute for Supply Management reported Monday.
Economists polled by Thomson Reuters had expected a 56.3 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index slipped to 53.0 from 55.9.
The employment index slid to 52.7 from 55.3.
The business activity/production index gained to 61.5 from 59.5, the new orders index was at 58.3, up from 57.9; backlog of orders rose to 50.5 from 48.5; new export orders slid to 52.0 from 55.0; inventories rose to 55.0 from 51.0; inventory sentiment soared to 65.0 from 59.0; the supplier deliveries index grew to 51.5 from 50.0; and imports fell to 48.0 from 53.5.
Members' general comments on business in the month included:
"Avian Influenza has significantly impacted business." (Agriculture, Forestry, Fishing & Hunting)
"Strong Summer in the industry. Supply chain challenges due to the Avian flu." (Arts, Entertainment & Recreation)
"Health care continues strong even with the looming negative impacts of Obamacare." (Health Care & Social Assistance)
"Favorable weather is keeping transactions positive, as well as the planting season on schedule. Drought in CA may lead to higher costs. Lower fuel cost are allowing people to travel and eat out more often. GDP is down and employment numbers are still too low. Bird Flu is a big concern and is already affecting chicken costs." (Accommodation & Food Services)
"The earlier surge this year in new business has slowed and remained constant." (Professional, Scientific & Technical Services)
"Activity picking up as the federal government nears late Q3 and early Q4 spending." (Public Administration)
"The overall business outlook remains strong and performance in our market has been very good." (Retail Trade)
"Our sales are still trending up year-to-date versus last year-to-date." (Wholesale Trade)
