NEW YORK – The U.S. services sector expanded at a faster pace in February as the non-manufacturing business activity composite index was 59.7 in February, compared to 59.4 in January, on a seasonally adjusted basis, the Institute for Supply Management reported Thursday.
Economists polled by Thomson Reuters had expected a 59.7 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index, closely watched for signs of inflation, jumped to 73.3 from 72.1.
The employment index increased to 55.6 from 54.5.
The business activity/production index rose to 66.9 from 64.6, the new orders index was at 64.4, off from 64.9; backlog of orders gained to 52.0 from 50.5; new export orders increased to 56.5 from 53.5; inventories jumped to 55.5 from 49.0; inventory sentiment slid to 57.5 from 60.0; the supplier deliveries index fell to 52.0 from 53.5; and imports remained 53.5.
Members' general comments on business in the month included:
“Business started picking up late last year and appears to be sustaining that level through the beginning of 2011.” (Professional, Scientific & Technical Services)
“Business environment is generally improving.” (Management of Companies & Support Services)
“We are seeing strength in our business both from the perspective of new business and expansion with our existing customers.” (Finance & Insurance)
“Strong demand; capacity crunch all around.” (Transportation & Warehousing)
“Major uptick in business activities.” (Accommodation & Food Services)
“Commodities are once again putting significant pressure on prices and capacity.” (Retail Trade)
