New data from the Institute for Supply Management (ISM) reveals that the U.S. service sector is showing robust signs of expansion, potentially offsetting emerging weaknesses in manufacturing. The latest Non-Manufacturing Index (NMI) surged in February, signaling an accelerated pace of economic growth.
The NMI climbed to 59.7 in February, a significant 3.0 percentage point increase from January's reading of 56.7. This rebound not only erased January's 1.3% decline but also marked the highest level in nearly a year. Any reading above 50 indicates sector expansion, and the latest figure extends the non-manufacturing sector's growth streak to 109 consecutive months , demonstrating remarkable economic resilience.
February's performance exceeded the 12-month average of 58.7 by a full percentage point, suggesting growth slightly above long-term trends. This development provides analysts and investors with encouraging evidence that may help alleviate concerns about broader economic slowdown.
Encompassing retail, healthcare, financial services, and other key industries, the non-manufacturing sector offers a comprehensive view of overall economic health. The NMI serves as one of the most closely watched indicators for assessing U.S. economic prospects. Market observers will monitor upcoming NMI releases to determine whether services can sustain their current momentum and continue driving economic expansion.