Since early 2022, the services sector has been outperforming manufacturing consistently, with short periods of convergence. The spread is narrowing since December and is now at the lowest level in more than a year
Wednesday ISM services survey showed a sharp pullback in the prices paid subcomponent, the index fell for a second consecutive month to post the largest two-month decline since 2008
The change in the prices paid services index is of interest, given the inflation stickiness we've seen in the sector. Also, the ISM activity indicator is closely followed by the Fed, the March data point could raise the prospects for inflation to keep its downward trend
January and February hotter than expected CPI readings questioned disinflationary progress, however, a March easing could concrete expectations that the Fed will likely cut rates by three times this year
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