"It appears that activity held up pretty well despite the government shutdown"
- Ryan Wang, an economist at HSBC Securities USA Inc.
Service sector in the U.S. unexpectedly expanded in October, signalling that the biggest contributor to the nation's economy is overcoming the political impasse, which partially shut down the federal government. The Institute for Supply Management's non-manufacturing index rose to 55.4 in October from a reading of 54.4 in September, with a figure above the 50-threshold indicating growth in the sector. Analysts, however, had expected the index to fall to 54.0 last month. The data also showed that employment at service providers increased last month, adding to sign that rising sales help business leaders look beyond the fiscal talks in Washington. The employment index rose to 56.2 last month following a decline to 52.7 in September from 57.0 in August. Other non-manufacturing sub-indexes stayed expansionary in October. The Labor Department will publish the delayed October employment report Friday. Analysts project subdued job growth of around 120,000, generated mostly by service providers. If the expectations are accurate, this would be the smallest job gain since July and well below the 185,000 monthly average of the past year.
Following the release of ISM Non-manufacturing PMI data, the greenback strengthened versus the Euro, with EUR/USD falling 0.47% to trade at 1.3451, while U.S. stock markets remained lower.
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