But service sector index suggests cautious optimism
The ISM Non-Manufacturing Index gained 1.7 points to 53.2 points in September, topping most expectations and suggesting that activity in the broad-based services industries picked up a little bit last month.
The closely-followed gauge is not giving the all-clear sign, and the trend over the last four to six months has been to the downside. But the economy is not sliding back into a recession and a quick look at some of the key subcomponents shows that there are reasons for optimism.
New orders rose 2.5 points to 54.9, indicating that further gains may be coming in October. Employment, which has suffered, increased 2.0 points to 50.2. Not an impressive level but moving in the right direction. And export orders surged.
The overall increase, though encouraging, will probably not have much impact on what the Fed does when it meets in early November.
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