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US Service Activity Rises to 4 Year High

Activity in the U.S. services sector held at its highest level in 4-1/2 years in July, though readings for new business and employment growth weakened, a survey showed on Monday.

Financial data firm Markit said its preliminary services Purchasing Managers Index was 61.0 in July, unchanged from June and above expectations for a reading of 59.8.

A reading above 50 signals expansion in economic activity, and June’s reading was the highest final reading since the survey began in October 2009.

 
The services sector continued to add employees, though at a slower pace. The employment index fell from 56.1, the fastest rate on record, to 52.8 in July. The new business subcomponent also fell from June’s record level.

“While a cyclical upswing appears underway across the service sector, the latest survey provides some indication that a smoother ride is not yet fully entrenched,” said Chris Williamson, chief economist at Markit.

“Nonetheless, service sector companies continue to perform strongly against post-recession trends, and overall the latest manufacturing and services PMI surveys suggest that the US economy has enjoyed a strong start to the second half of 2014.”

via Reuters [1]

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Alfonso Esparza

Alfonso Esparza [6]

Senior Currency Analyst at Market Pulse [7]
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza