US service sector PMI surges in October

According to data reported by Markit Economics, a measure of US service sector activity accelerated in October, achieving growth at its strongest pace in almost a year. Markit’s services sector Purchasing Managers’ Index (PMI) increased to a reading of 54.8 from 52.3 a month ago. The Markit Composite PMI, which combines manufacturing and services sectors, also climbed to 54.9 from 52.3 in September. Any reading above 50 indicates an expansion while any figure below 50 represents a contraction.

Previously, Markit’s reading of manufacturing PMI had increased to a reading of 53.2 in October.

The recent upturn in business activity was attributed to strong domestic economic conditions and increased spending by customers.

Markit chief economist, Chris Williamson commented that increasing new orders in October reported by the surveys could signal the biggest increase on a monthly basis in nearly one year in business activity.