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A Large ISM Services Miss As New Orders Plunge

US DATA
  • The ISM Services index was far weaker than expected in June at 48.8 (cons 52.7) after 53.8 in May.
  • It more than reverses the 4.4pt increase in May, leaving it at its lowest since May’20 in contrast to the just published 55.3 for the services PMI being the highest since Apr’22.
  • New orders are the most eye-catching: 47.3 (cons 53.6) after 54.1, it’s first sub-50 reading since Dec’22 (followed by a 14pt lurch higher), Apr/May 2020 and before that mid-2009.
  • Employment also sees a large miss: 46.1 (cons 49.5) after 47.1, reversing a tentative improvement in May for one of its lowest over the past year and coming ahead of Friday’s payrolls release.
  • Prices paid soften more than expected: 56.3 (cons 56.7) after 58.1. Not a huge change in trend terms, averaged 58.3 in 1H24 after 57.4 in 2H23.
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  • The ISM Services index was far weaker than expected in June at 48.8 (cons 52.7) after 53.8 in May.
  • It more than reverses the 4.4pt increase in May, leaving it at its lowest since May’20 in contrast to the just published 55.3 for the services PMI being the highest since Apr’22.
  • New orders are the most eye-catching: 47.3 (cons 53.6) after 54.1, it’s first sub-50 reading since Dec’22 (followed by a 14pt lurch higher), Apr/May 2020 and before that mid-2009.
  • Employment also sees a large miss: 46.1 (cons 49.5) after 47.1, reversing a tentative improvement in May for one of its lowest over the past year and coming ahead of Friday’s payrolls release.
  • Prices paid soften more than expected: 56.3 (cons 56.7) after 58.1. Not a huge change in trend terms, averaged 58.3 in 1H24 after 57.4 in 2H23.