Service Sector Growth Remains Limited

Growth in Markit Economic's U.S. service sector sample remains limited, at 51.0 for the final August reading vs 50.9 for the August flash and 51.4 for July. New orders slowed in the month as did business activity with employment gains slowing to the weakest level since December 2014. The report continues to cite weakness in client demand and uncertainty over the presidential election as negatives. Price readings are muted. A positive, however, is relative strength in the 12-month outlook which continues to rise from a survey low in June. The results underscore the risk of second-half weakness for the bulk of the U.S. economy, as likewise indicated by yesterday's ISM non-manufacturing report where headline growth came in at a cycle low.

Recent History Of This Indicator:
The services PMI has been running flat near the breakeven 50 level and pointing to only marginal growth for the bulk of the nation's economy. The flash index for August came in at 50.9 and forecasters see only slight improvement for the month's final reading, at a consensus 51.2. Growth in new orders has been soft as has employment. This report, at least yet, has not been pointing to the big third-quarter rebound that is widely expected.