Tempe’s ISM says US service sector activity forges ahead as trade deficit hits record

by   |  VIEW 1094

Tempe’s ISM says US service sector activity forges ahead as trade deficit hits record

Institute of Supply Management (ISM), the Tempe, Arizona-headquartered world’s oldest and largest trade body of supply management having had over 5,000 member entities, said on Tuesday that the Unites States’ vast services sector activity had picked up modestly in September, however, analysts remained utterly sceptical over a plausible stall in growth momentum amid a chronic shortage in inputs alongside high-flying inflation indicators.

In point of fact, latest rise in US services sector activity came against a tempestuous backdrop of a telescoped supply chain with hopes of an ease in supply chain tailbacks having been dented due to an insurgence of pandemic outbreak over Summer, while most ports in China alongside the US had been witnessing a havoc-scale congestion, tempering growth momentum as beforementioned.

Nevertheless, ISM’s recent survey data for US services activity came forth just days after the Tempe, Arizona-based supply management association had told in a statement that its index for US manufacturing activity had shot up to 61.1 last month from a reading of 59.9 logged a month earlier despite debarkations of a rancorous supply chain bottleneck around the globe.

US Services Sector activity rises modestly in September

According to ISM data, the supply management association’s index for US non-manufacturing activity perked up to a figure of 61.9 in September compared to a reading of 61.7 registered in August with retail trade, public administration, finance alongside insurance among others reporting growth.

Meanwhile, addressing to a dubious outlook in supply chain constraint over coming months, a lead US economist at Oxford Economics in New York, Oren Klachkin said following the announcement, “We don’t expect supply-side constraints to start easing meaningfully until mid-2022.

Solid demand and less Covid wariness will keep services growing, but the expansion will be capped by the supply side’s limited ability to meet demand”. On top of that, other economic data released earlier in the day had revealed that US trade deficit soared 4.2 per cent to a record $73.3 billion in August, beating an analysts’ estimate of $70.5 billion.