The Institute for Supply Management (ISM) reported its non-manufacturing index (NMI) came in at 55.5 in April, which was 0.6 percentage point lower than the March reading of 56.1 percent. The April reading pointed to the weakest expansion in the services sector since July 2017.

Economists forecast the index to increase to 57.0 last month. A reading above 50 signals expansion, while a reading below 50 indicates contraction. 

Of the 18 manufacturing industries, 15 reported growth last month, the ISM said.

According to the report, the ISM’s non-manufacturing business activity measure rose to 59.5 percent, 2.1 percentage points higher than the March reading of 57.4 percent. That reflected growth for the 117th consecutive month, at a faster rate in April. Meanwhile, the new orders gauge decreased to 58.1 percent, 0.9 percentage point lower than the reading of 59 percent in March. The employment indicator fell 2.2 percentage points in April to 53.7 percent from the March reading of 55.9 percent. The Prices Index dropped 3 percentage points from the March reading of 58.7 percent to 55.7 percent, indicating that prices increased in April for the 23rd consecutive month. 

Commenting on the data, the Chair of the ISM Non-Manufacturing Business Survey Committee, Anthony Nieves, noted, "The past relationship between the NMI and the overall economy indicates that the NMI for April (55.5 percent) corresponds to a 2.4-percent increase in real gross domestic product (GDP) on an annualized basis.”