Investing.com - A closely-watched gauge of U.S. service sector sentiment rose in January, according to a business survey released on Monday.
The Institute of Supply Management’s non-manufacturing purchasing manager's index (PMI) increased to 59.9, compared to forecasts for a reading of 56.5.
The prior month’s reading was 56.0.
On the index, a reading above 50.0 indicates the non-manufacturing sector economy is generally expanding, below 50.0 indicates the sector is contracting.
The Non-Manufacturing Business Activity Index increased to 59.8 last month, 2.0 points above December’s reading of 57.8.
Economists had forecast a decline to 57.2.
The New Orders Index registered 62.7 in January, 8.4 points higher than the reading of 54.3 in the previous month.
The Employment Index advanced 5.3 points to 61.6 last month from December’s reading of 56.3.
The Prices Index increased 2.0 points to 61.9 in January from the prior month’s reading of 59.9.
“The non-manufacturing sector reflected strong growth in January after two consecutive months of pullback,” ISM chair Anthony Nieves explained in the report.
“Overall, the majority of respondents’ comments are positive about business conditions and the economy,” he noted, adding that, “they also indicated that recent tax changes have had a positive impact on their respective businesses.”