Investing.com - Market players pushed back expectations for the next U.S. rate hike after data showed that U.S. service sector activity dropped to its weakest level since January 2010.
The Institute of Supply Management (ISM) said its non-manufacturing purchasing manager's index fell to 51.4 last month from 55.5 in July. Analysts had expected the index to drop to 55.0.
That followed the ISM manufacturing survey published last week, which showed a shocking contraction in activity.
The disappointing data lowered the potential for the Federal Reserve to raise rates at its meeting later this month.
According to Investing.com's Fed Rate Monitor Tool, investors are pricing in a 15% chance of a rate hike at the Fed's September 20-21 meeting, down from 27% ahead of the data and 30% a day earlier.
For December, odds stood at 47%, compared to 56% before the data arrived.