US: ISM non-manufacturing data consistent with expectations for growth slowdown in H2 – Wells Fargo

Data released today showed the ISM non-manufacturing fell to 53.7, lowest since August 2016. Analysts at Wells Fargo, point out that although still above 50, there were signs that global growth and trade headwinds are extending beyond the factory sector.

Key Quotes: 

“The ISM non-manufacturing index fell to nearly a three-year low in July as slowing global growth and trade headwinds have shown up outside the factory index. The index declined to 53.7, with agriculture, retail and wholesale trade among the industries reporting a contraction in activity.”

“Despite slowing activity, hiring picked up over the month in another sign the labor market remains strong.”

“Among sub-components, the sharpest drop was a 5.1-point decline in current activity to 53.1. New orders weakened more modestly, but were still down 1.7 points to 54.1. Growth in orders backlogs and exports also slowed over the month.”