US ISM Services PMI rises to 56 in October vs. 53.8 expected

• The ISM Services PMI improved to 56 in October.
• The US Dollar Index stays in the red below 104.00.

The economic activity in the US service sector expanded at an accelerating pace in October, with the ISM Services PMI rising to 56 from 54.9 in September. This reading came in above the market expectation of 53.8.

Other details of the report showed that the Prices Paid Index, the inflation component, edged lower to 58.1 from 59.4, while the Employment Index improved to 53 from 48.1.

Assessing the survey’s findings, “concerns over political uncertainty were again more prevalent than the previous month,” said Steve Miller, Chair of the Institute for Supply Management (ISM) Services Business Survey Committee. “Impacts from hurricanes and ports labor turbulence were mentioned frequently, although several panelists mentioned that the longshoremen’s strike had less of an impact than feared due to its short duration.”

Market reaction

The US Dollar Index showed no immediate reaction and was last seen losing 0.2% on the day at 103.70.