The Institute for Supply Management (ISM) reported its Services Purchasing Managers' Index (PMI) at 54.0 for June, down 0.5 points from May's 54.5, matching market expectations of 54.0. The slight decline reflects a continued but moderating expansion in the US services sector. The June reading remains 0.9 points above the 12-month moving average of 53.1, with ISM confirming the overall economy has sustained growth for 73 consecutive months through June and the services sector has expanded for 24 straight months.
ISM Services PMI Records 54.0 in June
The ISM Services PMI registered 54.0 in June, down from 54.5 in May. The reading matched the market consensus forecast of 54.0 compiled by Yonhap Infomax. A PMI above 50 indicates expansion, while below 50 signals contraction. The June figure stands 0.9 points higher than the 12-month moving average of 53.1.
ISM stated the overall US economy has maintained growth for 73 consecutive months through June. The services sector specifically has remained in expansion for 24 consecutive months.
Component Indices Show Mixed Performance
The Business Activity Index declined 2.3 points to 55.4 in June from 57.7 in May. The New Orders Index fell 2.2 points to 55.1 from May's 57.3.
The Employment Index rose 3.3 points to 51.2 from 47.9 in May, marking its first expansion in four months. The Prices Index decreased 3.6 points to 67.7 from 71.3 in May, continuing its 109-month consecutive upward trend.
The Inventory Index dropped sharply by 11.3 points to 51.2 from 62.5 in May, indicating a significant deceleration in growth rate.
Fourteen Industries Report Growth in June
Fourteen industries recorded growth in June, including Arts, Entertainment and Recreation; Mining; Wholesale Trade; and Transportation and Warehousing.
The Utilities and Information industries both sustained expansion for more than six months. Memory devices, copper, aluminum, and HVAC equipment have remained on the list of rising-price commodities for several months.
ISM Official Addresses Tariff Impact and Inventory Decline
Steve Miller, Chair of the ISM Services Business Survey Committee, stated: "June survey respondents mentioned the price impact of petroleum products less frequently, while tariff effects continued to emerge as a theme adding upward price pressure. The Inventory Index fell to its second-lowest level since October 2025, which may suggest the front-loading phenomenon seen earlier this year has concluded."
Miller added: "Despite easing in the Supplier Deliveries Index, the number of raw materials classified as 'in short supply' increased from five in May to nine in June. All materials reporting shortages in June were essential items for data center construction."
S&P Global Services PMI Final Reading at 51.2
S&P Global reported its final US Services PMI for June at 51.2, slightly below the market expectation of 51.4.
Chris Williams, Chief Business Economist at S&P Global Market Intelligence, commented: "The services economy sector recorded its strongest expansion since the outbreak of the Middle East conflict, but growth momentum remains lackluster compared to early this year before the conflict. Overall, the survey data suggests the US economy is growing at only a 1.2% annualized rate during the second quarter."
FAQ
What was the US ISM Services PMI for June?
The ISM Services PMI registered 54.0 in June, down 0.5 points from May's 54.5, matching market expectations of 54.0.
How did the ISM Employment Index perform in June?
The Employment Index rose 3.3 points to 51.2 from 47.9 in May, marking its first expansion in four months after crossing above the 50 threshold.
