Friday, September 03, 2010
Significantly weaker services
Posted by David Smith at 12:00 PM
Category: Thoughts and responses

The service sector purchasing managers' index made it three in a row, weakening in August as did the manufacturing and construction PMIs. The drop from 53.1 to 51.3 was bigger than expected and represented a 16-month low for the index. Disappointingly, the employment component was particularly weak, though business expectations firmed slightly.

Markit, which produces the numbers, thinks the PMIs are consistent with 0.5% GDP growth in the third quarter, down from the unexpected 1.2% second quarter jump. We are back to the kind of recovery we expected. More here.