U.S. ISM Services PMI Rebounds in March
Summary
- Economic activity in the services sector expands in March for the 22nd straight month.
- Rebounds in business activity, new orders and employment.
- Prices index rises to a near record high.
The U.S. ISM Services PMI was at 58.3 in March, up from 56.5 in February but down from 59.9 in January, according to the Institute for Supply Management. The March reading was down from a peak of 68.4 in November and 62.2 in March 2021. However, the 12-month average was 62.3, reflecting consistently strong growth in the U.S. services sector. The Action Economics Forecast Survey had expected 58.1 for March. Haver Analytics constructs a composite index combining the services index and manufacturing reading. This index was at 58.2 in March, up from 56.7 in February but down from 62.4 in March 2021. These series date back to July 1997.
In the latest services survey, the business activity index rebounded to 55.5 in March from 55.1 in February. An improved 30.7% (NSA) of respondents reported higher activity, up from 24.4% in February. A lessened 14.7% reported an activity decline, slightly down from February's 16.3%. The new orders index recovered to 60.1 from 56.1. A higher 31.0% (NSA) of respondents reported more orders while a lessened 11.0% reported a decline. The employment index rebounded to 54.0, a three-month high, from a 48.5 contraction-level. An improved 24.9% of respondents indicated higher employment but a lessened 15.7% reported it lower. The percentage indicating that employment held steady rose to 59.4% of respondents. The supplier deliveries index (NSA) fell to 63.4 in March from 66.2 in February. An improved 5.9% of respondents reported faster delivery speeds while 32.7% reported slower speeds.
The prices index rose to a near record 83.8 in March from 83.1 in February, registering the highest level since December's record-high 83.9. A higher 72.9% (NSA) of respondents reported price increases while 0.6% reported price decreases. A lessened 26.5% reported stable prices.
The new export orders index advanced to 61.0 in March, the highest level since December, from 53.0 in February. The backlog of orders index improved to 64.5, the highest level since November, from 64.2. The inventories index rose to 51.7, the highest level since March 2021, from 50.8. This also indicated that inventories grew in March for the second straight month after eight consecutive months of contraction. The imports index, however, fell to 45.0 in March, the lowest level since May 2020, from 51.7 in February, showing the first contraction since September. These series are not seasonally adjusted and not included in the ISM Services PMI total.
The ISM figures are available in Haver's USECON database, with additional detail in the SURVEYS database. The expectations figure from Action Economics is in the AS1REPNA database.
Winnie Tapasanun
AuthorMore in Author Profile »Winnie Tapasanun has been working for Haver Analytics since 2013. She has 20+ years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations. Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia. Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.
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