The vast US services sector bolted to a six-and-a-half-year record pace in January as businesses brimmed with economic confidence, according to the latest survey.
The Institute for Supply Management (ISM) said its index of non-manufacturing activity, based on a survey, leapt 7.7 points in January to 65.7 - the highest since July 1997. It was the 10 consecutive month of growth, breezing past economists' modest expectations. Any figure above 50 points indicates expanding activity.
New orders, order backlogs, employment, prices, imports and exports all increased.
Executives showed new optimism, providing comments such as: 'Things are definitely on the upswing,' and 'Improving economic outloook, increased holiday sales, more business optimism than a year ago.'
New orders flooded in at the fastest pace since August and the second-fastest in the history of the survey, with the index surging to 64.9 points from 59.5. Jobs grew, but at a slower pace, with the index staying above the boom-or-bust line of 50 points but easing 0.6 points from the previous month to 53.4.
The backlog of orders also expanded more slowly, with the index easing two points to 53.5. Prices paid for materials and services increased for the 23rd month in a row albeit at a slower pace, with the index falling 0.6 points to 59.7.
* US factory orders rose 1.1% in December after a 1.4% decline the previous month, the Commerce Department said today. The increase was much stronger than the 0.2% increase expected by Wall Street analysts.
