Some early signs of service-sector stress in May ISM
|The Services ISM flashed contraction in May. The overall report was a bleak read on service-sector activity, but the details mostly reflect the dynamics of a pull-forward in demand ahead of tariffs. The plunge in demand does not bode well for coming activity, but it's too soon to know if cost pressure will be sustained and its influence on hiring. The services ISM hasn't exactly been flashing signs of robust growth in recent years as it's been running below its prior cycle (2010-2019) average suggesting a slow pace of expansion in the sector. But the May Services ISM report was pretty bleak. The index has now been in a trend decline over the past year, and not only did the headline composite index slip below 50, designating contraction in the sector, but the details suggest activity is potentially worse than implied by the 49.9 reading.Summary
Not looking good
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