US: ISM Services PMI declines to 55.3 in February vs. 58.7 expected

• ISM Services PMI came in weaker than expected in February.
• US Dollar Index clings to daily gains around 91.00 after the data.

The economic activity in the US' service sector continued to expand in February albeit at a softer pace than it did in January with the ISM Services PMI declining to 55.3 from 58.7 This reading missed the market expectation of 58.7.

Further details of the publication showed that the New Orders Index declined to 51.9 from 61.8, the Employment Index edged lower to 52.7 from 55.2. Finally, the Prices Paid Index jumped to its highest level since September 2008 at 71.8.

Commenting on the data, "there was a pullback in the rate of growth in the services sector in February," said Anthony Nieves, Chair of the Institute for Supply Management Services Business Survey Committee.

"Respondents are mostly optimistic about business recovery and the economy," Nieves added. "Production-capacity constraints, material shortages and challenges in logistics and human resources are impacting the supply chain.

Market reaction

This report doesn't seem to be having a significant impact on the greenback's performance against its rivals. As of writing, the US Dollar Index was up 0.2% on the day at 90.97.