US Services Growth Slows Down in February

March 5, 2014 Share Print 0

Growth and the pace of hiring in the U.S. services sector slowed in February, an industry report showed on Wednesday, though industry executives said unusually bad weather was in part to blame for disruptions in economic activity.

Financial data firm Markit said its final service sector purchasing managers’ index dipped to 53.3 in February from 56.7 in January. A reading above 50 signals economic expansion, and the result was better than Markit’s preliminary “flash” reading of 52.7 released last week.

Employers in the service sector, which accounts for about three-quarters of the U.S. labor market, continued to add employees, but at the slowest rate since March 2013. The final employment index came in at 51.9 in February, compared with 54.1 in January.

This winter has been colder than usual, with severe snowstorms affecting large parts of the Northeast, Midwest and Upper Midwest of the country, and the Southeast has experienced unusual ice storms in recent weeks as well. Investors have largely attributed a spate of weak economic releases to the weather, and expect a rebound in growth in the spring.

Chris Williamson, chief economist at Markit, said the rate of growth was estimated to have held steady from January when excluding those that cited the weather as a reason for slack demand.

via Reuters

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

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.