
U.S. Services Sector Sees Unexpected Slowdown in January
WASHINGTON - The U.S. services sector experienced an unexpected deceleration in January, as reported by Lucia Mutikani for Reuters (source). This slowdown was primarily driven by a decrease in domestic demand, providing some relief from the upward pressure on prices.
According to data from the Institute for Supply Management (ISM), the nonmanufacturing Purchasing Managers Index (PMI) dropped to 52.8, down from December's 54.0. This figure, although above the 50 threshold that indicates growth, fell short of economists' expectations who predicted a rise to 54.3.
The services sector, representing over two-thirds of the U.S. economy, played a vital role in economic growth in recent months, as supported by robust consumer spending in the fourth quarter. However, the easing of demand in January, reflected in the ISM new orders measure declining to 51.3, has slowed overall momentum.
The cooling in demand helped to reduce the ISM's gauge of prices paid for services inputs, which fell to 60.4 from a high of 64.4 in December. Despite this positive turn for price moderation, the inflation outlook remains uncertain due to potential trade tensions, including tariffs and policy changes under President Trump's administration.
In response to inflation rates that have resisted falling to the Fed's 2% target, the U.S. central bank maintained its benchmark interest rate at 4.25% to 4.50% last week. This decision follows a series of rate hikes totaling 5.25 percentage points through 2022 and 2023, underscoring the Fed's commitment to controlling inflation.
On the employment front, the ISM survey indicated a slight increase in services employment to 52.3. However, this measure has shown limitations in predicting services payroll changes in the government's employment reports, with the latest figures due soon. The labor market added approximately 170,000 jobs in January after a strong 256,000 increase in December, with the unemployment rate remaining steady at 4.1%.
Further insights from IndexBox reveal a nuanced understanding of market trends, although further analysis remains necessary to predict future shifts with precision.
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1. INTRODUCTION
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- REPORT DESCRIPTION
- RESEARCH METHODOLOGY AND AI PLATFORM
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2. EXECUTIVE SUMMARY
A Quick Overview of Market Performance
- KEY FINDINGS
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3. MARKET OVERVIEW
Understanding the Current State of The Market and Its Prospects
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4. MOST PROMISING PRODUCT
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- IMPORTS BY COUNTRY
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The Largest Exporters on The Market and How They Succeed
- EXPORTS FROM 2012–2024
- EXPORTS BY COUNTRY
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10. PROFILES OF MAJOR PRODUCERS
The Largest Producers on The Market and Their Profiles
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11. COUNTRY PROFILES
The Largest Markets And Their Profiles
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- China
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- Germany
- United Kingdom
- France
- Brazil
- Italy
- Russian Federation
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LIST OF TABLES
- Key Findings In 2024
- Market Volume, In Physical Terms, 2012–2024
- Market Value, 2012–2024
- Per Capita Consumption, By Country, 2018–2024
- Production, In Physical Terms, By Country, 2012–2024
- Imports, In Physical Terms, By Country, 2012–2024
- Imports, In Value Terms, By Country, 2012–2024
- Import Prices, By Country Of Destination, 2012–2024
- Exports, In Physical Terms, By Country, 2012–2024
- Exports, In Value Terms, By Country, 2012–2024
- Export Prices, By Country Of Origin, 2012–2024
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LIST OF FIGURES
- Market Volume, In Physical Terms, 2012–2024
- Market Value, 2012–2024
- Consumption, By Country, 2024
- Market Volume Forecast to 2030
- Market Value Forecast to 2030
- Products: Market Size And Growth, By Type
- Products: Average Per Capita Consumption, By Type
- Products: Exports And Growth, By Type
- Products: Export Prices And Growth, By Type
- Production Volume And Growth
- Exports And Growth
- Export Prices And Growth
- Market Size And Growth
- Per Capita Consumption
- Imports And Growth
- Import Prices
- Production, In Physical Terms, 2012–2024
- Production, In Value Terms, 2012–2024
- Production, By Country, 2024
- Production, In Physical Terms, By Country, 2012–2024
- Imports, In Physical Terms, 2012–2024
- Imports, In Value Terms, 2012–2024
- Imports, In Physical Terms, By Country, 2024
- Imports, In Physical Terms, By Country, 2012–2024
- Imports, In Value Terms, By Country, 2012–2024
- Import Prices, By Country, 2012–2024
- Exports, In Physical Terms, 2012–2024
- Exports, In Value Terms, 2012–2024
- Exports, In Physical Terms, By Country, 2024
- Exports, In Physical Terms, By Country, 2012–2024
- Exports, In Value Terms, By Country, 2012–2024
- Export Prices, 2012–2024