Services sector slows in December, factory orders rise
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[January 07, 2014]
By Ryan Vlastelica
NEW YORK (Reuters) — Two measures of
activity in the U.S. services sector showed slower growth in
December, pointing to an economy that continues to expand at a
modest pace, while factory orders rose in November.
The pace of growth in the U.S. services sector slowed for a second
straight month in December with business activity expanding at a
lower rate and new orders contracting, according to the Institute
for Supply Management.
ISM's index fell to 53 last month from 53.9 in November, dropping to
its lowest reading since June 2013 and under expectations for a read
Separately, financial data firm Markit said its services sector
Purchasing Managers Index eased slightly from the prior month,
slipping by 0.2 point to 55.7 in the month.
"We think the economy is on track and in recovery mode, and it isn't
unusual to see periodic weak reports," said David Carter, chief
investment officer at Lenox Wealth Advisors in New York. "ISM was a
bit weak but the ongoing trend supports an ongoing recovery."
For both surveys, a reading above 50 indicates expansion. December
marked the 48th straight month of growth in ISM's services index. In
addition, ISM's employment gauge rose to 55.8 from 52.5 in November.
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A separate report from the Commerce Department showed new orders for
factory goods rebounded in November, rising 1.8 percent, as had been
The department also said orders for durable goods, manufactured
products expected to last three years or more, rose 3.4 percent
instead of the 3.5 percent increase reported last month. Durable
goods orders excluding transportation rose 1.2 percent as previously
(Reporting by Ryan Vlastelica)
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