The Institute for Supply Management’s non-manufacturing business activity composite index was 49.6 in March, up from 49.3 in February, on a seasonally adjusted basis, the group said yesterday.
Economists polled by IFR Markets had expected a 49.0 level.
The prices paid index, closely watched for signs of inflation, rose to 70.8 from 67.9. The employment index remained at 46.9.
“The NMI [non-manufacturing index] increased 0.3 [of a] percentage point to 49.6%, indicating contraction for the third consecutive month within the non-manufacturing sector for March 2008,” said Anthony Nieves, chairman of ISM’s non-manufacturing business survey committee.
“Non-manufacturing business activity increased for the second consecutive month. The new orders index increased 0.6 percentage point to 50.2%, and the employment index contracted for the third consecutive month, remaining at 46.9%. The prices index increased to 70.8% in March, indicating a faster rate in price increases than in February,” Nieves said.. “According to the NMI, 11 non-manufacturing industries reported growth in March. Members’ comments in March are mixed and reflect concern about rising fuel and energy costs and the impact they are having on commodity prices.”