New Orders Index increased from 52.2 in April to 54.1 in May, while Employment Index improved from 45.9 to 47.1.
The Institute for Supply Management commented: “The increase in the composite index in May is a result of notably higher business activity, faster new orders growth, slower supplier deliveries and despite the continued contraction in employment.”
According to the report, the majority of respondents believe that inflation and current interest rates are an impediment to improving business conditions. However, the strong report shows that the services sector continues to grow despite current challenges.
Today, traders also had a chance to take a look at the final reading of S&P Global Services PMI report for May. The report showed that S&P Global Services PMI increased from 51.3 in April to 54.8 in May, in line with analyst consensus.
U.S. Dollar Index moved towards session highs as traders reacted to the better-than-expected ISM Services PMI report. Currently, U.S. Dollar Index is trying to settle above the 104.40 level. Treasury yields moved higher as bond traders bet on hawkish Fed, which was bullish for the U.S. dollar.
Gold pulled back below the $2340 level as traders focused on rising Treasury yields and stronger dollar.
