US: ISM Services PMI rises to 53.9 in June vs. 51 expected

• US ISM Services PMI climbed to 53.9 in June.
• US Dollar Index continues to push higher toward 103.50.

The business activity in the US service sector continued to expand at a strengthening pace in June, with the ISM Services PMI rising to 53.9 in June from 50.3 in May. This reading came in above the market expectation of 51.

Further details of the publication revealed that the Prices Paid Index edged lower to 54.1 from 56.2 and the Employment Index climbed to 53.1 from 49.2.

Commenting on the survey's findings, “there has been an uptick in the rate of growth for the services sector," noted Anthony Nieves, Chair of the Institute for Supply Management (ISM) Services Business Survey Committee.

"This is due mostly to the increase in business activity, new orders and employment. Increased capacity, backlog reduction and continued improvements in logistics have impacted delivery times (resulting in a decrease in the Supplier Deliveries Index)," Nieves further explained. "The majority of respondents indicate that business conditions remain stable; however, they are cautious relative to inflation and the future economic outlook.”

Market reaction

The US Dollar Index extended its daily rebound after this report and was last seen posting small daily gains at 103.40.