US services sector contracts for 2nd straight month
The US services sector contracted for the second straight month in May despite the gradual reopening of businesses across the country amid the COVID-19 pandemic, the Institute for Supply Management (ISM) said in a report.
The non-manufacturing index (NMI), which gauges the performance of the services sector, registered 45.4 percent, 3.6 percentage points higher than the April reading, according to the latest Non-Manufacturing ISM Report on Business released on Wednesday.
Amid widespread COVID-19-induced shutdowns, the US services sector contracted for the first time since December 2009 in April, reports Xinhua news agency.
“Respondents remain concerned about the ongoing impact of the coronavirus,” Anthony Nieves, chair of the ISM’s non-manufacturing business survey committee, said in the new report.
“Additionally, many of the respondents’ respective companies are hoping and/or planning for a resumption of business,” Nieves said.
Since late April, many US states have started to reopen their economies, allowing certain nonessential businesses to operate under social distancing guidelines.
As of late May, all US states had been in some phase of reopening.
According to an ISM data released earlier this week, economic activity in the US manufacturing sector contracted for the third straight month in May, with the Purchasing Managers’ Index standing at 43.1 per cent.