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The largest part of the US economy cooled in March, according to surveys conducted by the Institute of Supply Management and Markit Economics.
ISM’s non-manufacturing purchasing manager’s index slowed to 55.2, lower than the forecast for 57. Readings above 50 indicate that there’s still expansion.
New orders, employment, and pricing in the service sector all picked up, but not as quickly as in February.
ISM said some managers were uncertain about the impact of President Donald Trump’s immigration, trade, and health care policies. Others remarked about worker shortages and not being able to fill their vacant positions, which shows a tight labor market .
Meanwhile, Markit Economics reported the slowest growth of the US service sector in six months in March.
The firm’s PMI, was 52.8, lower than the expectation for 53.1.
“The loss of momentum is linked to weaker inflows of new work, with the surveys providing some evidence that demand is being dented in part by higher prices,” said Chris Williamson, the chief business economist at IHS Markit, in the release.
Markit also found that business confidence has slipped from levels seen earlier this year, suggesting that some of the post-election euphoria is wearing off. Service providers hired at the slowest pace since October 2016, Markit said.