PMI Services Sample Pops Back

The PMI's service sample popped back up to its prior highs while the manufacturing sample inched up to yet new highs. The services PMI, driven especially by a rise in backlogs, rose more than 1 point to 55.7 to indicate the strongest rate of monthly growth in three months and above the 55 mark where it has appeared several times over the past year. Manufacturing, boosted by backlogs and also rising payrolls, rose 1 tenth to 56.6 which is the strongest reading in nearly four years.

Price pressures in both samples are evident with input costs rising at the fastest rate in nearly five years in pressure the report attributes in part to metal and especially steel prices. Positives in today's report are gains in the 6-month outlooks which, together with the overall results, hint at acceleration underway for the second-quarter economy. The composite index, reflecting the enormous size of the service sector, also came in at 55.7.