Implications: A solid plow horse report out of the service sector today. After signaling in February the slowest growth in the service sector in four years, the ISM service sector rebounded to 53.1 in March. A harsher than normal winter has wreaked havoc over much of the country and it now looks like the weather and economy are starting to thaw. After falling sharply last month to the lowest level since 2010, the employment index surged 6.1 points rising to 53.6 from 47.5 in February, the largest single-month gain ever recorded. Even though the business activity index – which has a stronger correlation with economic growth than the overall index – dipped to 53.4, the index still remains at a level that signals solid economic growth. On the inflation front, the prices paid index jumped to 58.3 in March from 53.7 in February. Still no sign of runaway inflation, but given loose monetary policy, we expect this measure to either stay elevated or even move upward over the coming year. In other recent news, automakers sold cars and light trucks at a 16.3 million annual rate in March, up 6.9% from February, up 6.9% from a year ago, and the fastest pace since November. Sales were held down by unusually bad weather in December thru February so the surge in March was, in part, catch up for lost time. However, sales in 2014 should continue to outstrip year-ago levels as consumers with growing incomes update the ageing fleet of autos now on roads across the US.
Click here for the full report.
|
|
Posted on Thursday, April 3, 2014 @ 1:02 PM
|