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United States PMI May 2024

United States: Business activity in the services sector improves sharply in May

The S&P Global U.S. Services Purchasing Managers’ Index (PMI) rose to 54.8 in May from 51.3 in April. As a result, the index moved further above the 50.0 no-change threshold, and signaled a faster improvement in services-sector business activity compared to the previous month.

May saw a resurgence in new orders, attributed to effective marketing strategies and improvements in economic conditions. However, there was a continued decrease in new export orders due to price rises affecting external demand, and service providers reported a reduction in employment for the second consecutive month.

A sharper rise in input costs was observed in May, mainly due to higher wages for existing staff. Input cost inflation outpaced the pre-pandemic average. This led to a faster rise in selling prices. Finally, there was a slight improvement in business sentiment, buoyed by a potential softening of inflation and hopes for reduced interest rates.

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