ISM Services Index Improves

The U.S. economy’s service sector improved, showing modest expansion last month, the Institute for Supply Management said Wednesday.

ISM’s monthly services index rose to a 50.1 reading, from 48.7 in November, ISM said in its monthly report.

Figures of more than 50 indicate expansion, while below that shows contraction. Economists had forecast an increase to a 50.5 reading, Bloomberg reported.

The new orders index, an indicator of future activity, fell to 52.1, from 55.1 in November month.

ISM’s services index measures non-manufacturing components of the economy, and the services sector, which includes transportation, retail sales and financial services, accounts for nearly two-thirds of the U.S. gross domestic product.