PMI Services Report Points To Strength

December's final for PMI services came in at 53.7, down noticeably from 54.5 in November but also up substantially from December's mid-month flash of 52.4. The 1.3 point gain from the flash to the final implies a roughly 55 reading for the last two weeks of the month which actually points to acceleration and solid strength. New orders are the strength for the last two weeks with backlogs also a positive. Hiring is described as solid and price pressures eased though respondents in the sample continue to report upward pressure for fuel costs and, more importantly, wages as well. Less than positive, however, is business confidence in the survey which the report describes as relatively subdued. Still, the gain in the final reading offsets the disappointment for the flash and hints at acceleration for the bulk for the economy going into year-end.

Recent History Of This Indicator:
PMI services slowed sharply in the December flash, down more than 2 points to 52.4. New orders eased to their lowest level in 8 months while hiring fell to a 7-month low. Business optimism came in at the second lowest readings since June last year. The Econoday consensus is calling for no change from the flash, at a consensus 52.4 for December's final.