US services sector contracts in April: ISM gauge hits four-year low

US services sector contracts in April: ISM gauge hits four-year low

The US services sector unexpectedly posted a decline in April, the first time since 2022. This came as a measure of business activity fell to a four-year low and costs rose. The Institute for Supply Management's main rate for the services sector fell 2 points to 49.4, the lowest level since December 2022. Readings below 50 indicate a decline, and the April figure was lower than all estimates in a Bloomberg survey of economists. This suggests increasing weakness in an important part of the US economy, as the services sector accounts for a significant portion of the country's gross domestic product. The fair data showed a sign of potential problems for economic growth and the overall recovery following the recent challenges posed by the global health crisis.