March Sees a Minor Decline in US Services Activity

The Institute for Supply Management (ISM) reported a slight decrease in the United States' service sector activity for March, with the Services Purchasing Managers' Index (PMI) adjusting from January's 53.5% to 50.8%. Despite this dip, the sector remains in the expansion territory, indicating continued growth.

Key Indexes Reflect Mixed Signals

The New Orders Index saw a decline of 1.8 percentage points to 50.4%, while the Inventory Sentiment Index and the Business Activity Index experienced increases of 1.9 and 1.5 percentage points to 56.6% and 55.9%, respectively. Notably, the Employment Index fell into contraction, dropping significantly by 7.7 percentage points to 46.2%.

Tariffs and Government Spending Concerns

"This month, there's been a notable rise in reports of cost increases due to tariff activities. Despite ongoing worries about potential tariffs and decreasing governmental spending, the near-term sentiment remains balanced," commented Steve Miller, Chair of the ISM Services Business Survey Committee.