US March Services PMI Preliminary at 54.3…Exceeds Market Expectations

Son Min

Summary

The US March Services PMI Preliminary was reported at 54.3, exceeding the market expectation of 51.2.
Service sector activity rebounded from February's low, indicating that the US service industry is expanding.
The S&P Chief Economist expressed concerns about the rebound being temporary, highlighting uncertainty in sustainability.

The preliminary reading of the US March Services Purchasing Managers' Index (PMI) exceeded market expectations.

According to the PMI report released by S&P Global on the 24th (local time), the preliminary US March Services Purchasing Managers' Index was 54.3, surpassing the market expectation of 51.2. This announced Services PMI index recorded a higher figure than last month's final figure (51), indicating that the US service industry is expanding.

The S&P Global report stated, "Service sector activity rebounded for the first time after hitting a 15-month low in February," and "Newly incoming demand and improved weather were major contributing factors."

Chris Williamson, Chief Economist at S&P, assessed, "The March rebound in the service sector may be a temporary weather effect, making its sustainability uncertain."

PMI uses 50 as the baseline to gauge whether the service industry is expanding or contracting. The preliminary PMI is a metric released before the final PMI at the end of the month, used to quickly assess economic conditions.