US ISM Services PMI drops to 49.4 in April vs. 52.0 expected
- US ISM Services PMI dropped into the contraction territory below 50 in April.
- US Dollar Index stays in negative territory below 105.00.
Business activity in the US service sector contracted in April, with the ISM Services PMI edging lower to 49.4 from 51.4. in March. This reading came in below the market expectation of 52.0.
Other details of the report showed that the Prices Paid Index, the inflation component, climbed to 59.2 from 53.4, while the Employment Index dropped to 45.9 from 48.5.
Assessing the survey's findings, "the decline in the composite index in April is a result of lower business activity, slower new orders growth, faster supplier deliveries and the continued contraction in employment,” said Anthony Nieves, Chair of the Institute for Supply Management Services Business Survey Committee, and continued:
"Survey respondents indicated that overall business is generally slowing, with rates varying by company and industry. Employment challenges continue to be primarily due to difficulties in backfilling positions and/or controlling labor expenses. The majority of respondents indicate that inflation and geopolitical issues remain concerns."
Market reaction
The US Dollar Index stays under bearish pressure after this report and was last seen losing 0.4% on the day at 104.90.