ISM Services Index Shows Continued Contraction

The U.S. economy’s service sector continued to contract in March, the Institute for Supply Management said Friday.

ISM’s monthly services index fell to a reading of 40.8 from 42.9 in February, the group said in its monthly report.

Figures of more than 50 indicate expansion, while below that shows contraction. Economists had forecast an improved reading of 42, Bloomberg reported.

The 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.