- Prior month 53.8
- ISM non- manufacturing PMI for February 56.1 versus 53.5 estimate.
- Nonmanufacturing business activity 59.9 vs 57.4 last month
- employment index 51.8 vs 50.3 last month.
- New orders 58.6 vs 53.1 last month.
- Prices paid 63.0 vs 66.6 last month. The index has exceeded 60 percent for 15 straight months, but February’s reading is its lowest since March 2025 (61.4 percent).
- Inventories 56.4 versus 45.1 last month. The Inventory Sentiment Index expanded for the 34th consecutive month, registering 55.3 percent, up 1 percentage point from January’s figure of 54.3 percent.
- Supplier deliveries 53.9 versus 54.2 last month
- Backlog of orders 55.9 versus 44.0 last month. The Backlog of Orders Index was in expansion territory for the first time since February 2025, registering 55.9 percent in February, an 11.9-percentage point increase from the January figure of 44 percent.
- New export orders 57.2 versus 45.0 last month
- imports 51.8 versus 40.2 last month
- inventory assessment 55.3 versus 54.3 last month.
Other details:
- Its 20th month in a row in expansion territory.
- Services index was the highest level since July 2022
- The Supplier Deliveries Index registered 53.9 percent, 0.3 percentage point lower than the 54.2 percent recorded in January. This is the 15th consecutive month that the index has been in expansion territory, indicating slower supplier delivery performance.A reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases.
- Fourteen industries reported growth in February, three more than in January, and the number reporting contraction shrank to three. The February Services PMI® reading of 56.1 percent is 4.1 percentage points above the 12-month average of 52 percent. This average is an uptick of 0.2 percentage point over January’s 12-month average of 51.8 percent
Steve Miller from ISM said:
“The services sector is heating up, with the Business Activity, New Orders, and New Export Orders indexes at their highest levels since 2024, and the Backlog of Orders Index with its best reading since July 2022 (58.3 percent). The Supplier Deliveries Index is higher (and indicates slower deliveries) than its 12-month average, but the index has eased slightly since the previous month. Gasoline was noted by some respondents as a commodity up in price for the first time since February 2025, and copper was up in price for the third month in a row. Commentary on trade uncertainty increased, with respondents commenting that tariffs impacts have stabilized and are now embedded in supply chain costs. Although there were several comments on tariff uncertainty regarding the U.S. Supreme Court decision, there was no alarm regarding supply chain performance, suggesting that services companies have developed capabilities to routinely address shifts in tariff policies.”
What is it?
The ISM Non-Manufacturing PMI (also called the ISM Services PMI) is a monthly survey published by the Institute for Supply Management (ISM) that measures the health and direction of the U.S. services sector, which accounts for roughly two-thirds of the U.S. economy. The index is based on responses from purchasing and supply executives across industries such as retail, finance, healthcare, transportation, construction, and professional services. Participants report whether business conditions—such as business activity, new orders, employment, supplier deliveries, and prices—are improving, unchanged, or deteriorating compared with the previous month. These responses are compiled into diffusion indices where a reading above 50 indicates expansion in the services sector, while a reading below 50 signals contraction. Because the services sector represents the majority of economic activity in the United States, the ISM Non-Manufacturing PMI is widely watched by economists, investors, and policymakers as an early indicator of economic momentum, inflation pressures, and labor market trends.
This article was written by Greg Michalowski at investinglive.com.
