January 9, 2017

OBOOMA:

U.S. Service-Sector Activity Expanded at Solid Pace in December, ISM Says (Ben Leubsdorf, 1/05/17, WSJ)

Growth in economic activity across the sprawling U.S. service sector was steady and solid in December, a sign of momentum for the broader economy headed into the new year. [...]

"With three of the most recent four readings from this index at a very solid level, including the last two, the message is one consistent with about a 3% pace of" growth in overall economic output, said Joshua Shapiro, chief U.S. economist at MFR Inc., in a note to clients.

The services-providing side of the U.S. economy has continued to post solid growth in recent years despite choppiness in the manufacturing sector, which had been pressured by a strong dollar and the energy sector's slump. The headline ISM services index has remained above 50 continuously for nearly seven years; the last contractionary reading was in January 2010.

Private service-providing industries accounted for more than two-thirds of total U.S. economic output in 2015, according to the Commerce Department, and growth in those sectors appeared to remain solid last year. Total revenue at service-providing firms rose 5.3% in the third quarter compared with a year earlier, according to the latest government data, the strongest annual revenue growth since late 2014.

Posted by at January 9, 2017 7:04 AM

  

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