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“September data signalled a solid expansion of business activity across the U.S. service sector, albeit with the rate of growth easing to an eight-month low,” the IHS Markit reported on Wednesday.

Key takeaways from the press release

  • The seasonally adjusted final IHS Markit U.S. Services Business Activity Index registered 53.5 in September, down from 54.8 in August.
  • Reassuringly, the rate of new business growth picked up in September, moving closer to the strength seen earlier in the year.  
  • Greater demand for inputs and the ongoing effects of tariffs were widely cited as factors behind a stronger rise in input prices in September.  

“Service sector business growth has eased considerably since peaking back in May, but remains relatively solid. Some of the slowdown can be traced to capacity constraints, with new  business once again rising at a steeper rate than firms were able to boost output,”  Chris Williamson, Chief Business Economist at IHS Markit, noted.