US ISM Services PMI rises to 55.4 in August, beating estimates for 26th straight month of expansion

The US services sector just posted its strongest reading in months, with the Institute for Supply Management’s Services PMI climbing to 55.4 in August from 54.1 in July. Economists had expected something closer to 54.3, so the beat wasn’t dramatic, but it was decisive enough to matter. That marks 26 consecutive months of expansion for the sector that effectively is the US economy. Any reading above 50 signals growth, and 55.4 puts comfortable distance between the current trajectory and contraction territory. What the numbers actually tell us The ISM Services PMI is a composite index drawn from surveys of purchasing and supply executives across 18 service industries. It covers everything from healthcare and finance to hospitality and professional services. July’s reading of 54.1 had already represented the 25th straight month of expansion. The jump to 55.4 suggests the sector isn’t just maintaining altitude. It’s gaining speed. The report, released on September 3 by the ISM’s Services Business Survey Committee chaired by Steve Miller, arrived on its usual schedule: the third business day after the surveyed month closes. Sub-component data painted a more nuanced picture. Business act...