-ISM
Even though activity in the US non-manufacturing sector rose in June, it fell shy of economists' expectations. According to the Institute for Supply Management, non-manufacturing PMI came in at 56.0 in June, up from 55.7 a month earlier, which was the lowest level since April last year. Yet, the reading remained firmly in expansion territory.
Meanwhile, a separate report showed the US labour market was less strong in June, suggesting the Fed might be less willing to begin hiking interest rates on September. The central bank's comprehensive gauge of employment conditions remained virtually flat at 0.8 points in the reported month, considerably below the 2 points economists had expected and following a downward revised 0.9 points in May. The US unemployment rate declined to post-recession lows of 5.3%, partly due to fall in participation rate, whereas more than 2.9 million jobs were added in the past twelve months. Still, most economists believe the Fed is likely to hike interest rates from all-time low in September, as the weekly jobless claims remain near the lowest levels of the business cycle, the number of vacant positions reached the highest level on record, and there were some signs of higher wage pressures, particularly in the quarterly employment costs index.
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