S&P Global announced that the purchasing managers’ index (PMI) for the services sector fell to 47.3 in July from 52.7 in June.
The PMI fell for the fourth consecutive month and is now below 50, indicating that the U.S. services sector is contracting – the first contraction since June 2020.
The PMI index was impacted by a slowdown in new orders. At the same time, business confidence fell to its lowest level in 22 months, although employment rose again.
According to the U.S. Commerce Department, U.S. factory orders rose 2.0% in June, following a 1.8% increase in May.
Year-on-year factory orders increased by 13.5% in June
Orders for core capital goods excluding weapons and aircraft increased by 0.7% in June. Orders for core capital goods are a measure of business confidence and spending plans.