November 2020 ISM And Markit Services Surveys Remain Modestly In Expansion

The ISM marginally declined but remained in expansion whilst the Markit PMI marginally improved and remained in expansion.

Analyst Opinion of the ISM and Markit Services Survey

The ISM services survey is and the Markit Services index show modest growth. I have a hard time believing services are in expansion with many restaurants, bars, and gyms running nowhere near full potential.

From Econoday:

  Consensus Range Consensus Actual
Markit Services 56.8 to 57.9 57.9 58.4
ISM Services 54.0 to 56.8 56.0 55.9

From Markit:

Sharpest increase in activity since March 2015

  • Substantial upturns in output and new business
  • Employment rises at fastest pace in survey history
  • Price indices at survey highs as cost pressures intensify
  • November PMITM data signalled a marked increase in business activity across the U.S. service sector. The upturns in output and new business accelerated substantially to the fastest since March 2015 and April 2018, respectively. As a result, firms took on extra staff at the steepest rate on record, as pressure on capacity accumulated. Business expectations also strengthened to the most buoyant since January 2014. Meanwhile, input prices rose at the quickest pace since data collection began in October 2009, while firms also raised their output charges at the fastest rate for more than a decade in an effort to pass on steeper cost burdens to customers
  • The seasonally adjusted final IHS Markit US Services PMI Business Activity Index registered 56.9 in October, up from 54.6 in September and higher than the earlier released 'flash' estimate of 56.0. The improvement indicated that the rate of growth regained momentum at the start of the fourth quarter to the sharpest since April 2015. Greater output was often attributed to stronger demand conditions and a further uptick in new business. October data indicated a steep upturn in new business at service providers, with the rate of expansion accelerating for the second month running. Some companies noted that looser coronavirus restrictions had encouraged sales. The pace of growth was the most marked since February 2019. That said, new export orders rose at a softer pace in October, as reimposed lockdown measures in key external markets dampened demand.


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