U.S. services growth strengthens as business costs climb

U.S. services activity accelerated in August, with the sector’s purchasing managers index rising to 55.4 from 54.1 in July. Readings above 50 indicate growth, and services account for more than two-thirds of U.S. economic activity.

New orders reached 60.9, their highest level since February 2023, while prices paid for business inputs rose to 72.6 from 70.3. The figures suggest strong demand and higher costs could keep inflation above the Federal Reserve’s 2% target.

Services employment remained subdued, with the employment index at 47.8. Financial markets were pricing in about a 64% chance of a quarter-point Fed rate increase at the central bank’s Sept. 15-16 meeting.

Read the full story at wtvbam.com.