ISM Services Index Climbs

The U.S. economy’s service sector expanded more than forecast in May, alleviating some concern the economy is faltering, the Institute for Supply Management said Friday.

ISM’s monthly services index climbed to a reading of 54.6 from a 52.8 reading in April, ISM said in its monthly report. Figures greater than 50 indicate expansion.

Economists had forecast the index would rise to 54, Bloomberg reported. Even with the gain, the measure is below the average for the prior six months, Bloomberg said.

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.