Services PMI Showing Soft Growth, As Expected

The services PMI came in showing soft growth as expected, at 52.1 in April which is up slightly from March. But growth in new orders is no better than marginal and backlogs are on the decline. Not surprisingly, hiring is as slow as it has been since October. Uncertainty over the economy and also the presidential election are cited as negatives. The service sector is still sluggish and needs to pick up steam to help offset weakness in the factory sector.

Recent History Of This Indicator:
The services PMI has been very soft, running near the breakeven in 50 level in what may be an ominous indication for the U.S. economy. Growth in new orders were extremely soft in the March report, at their lowest point in the 6-1/2 year history of the report. Backlog orders were also down as was confidence in the outlook, yet employment was still a positive, at least it was for March. Price data, as in other reports, have been subdued. March's final reading was 51.3 with the March flash at 51.0. Forecasters see some strength for the April flash, with the consensus at 52.0.