The latest report by IHS Markit revealed on Tuesday the seasonally adjusted final IHS Markit U.S. Services Business Activity Index (PMI) stood at 64.6 in June, up from 70.4 in May and slightly below the earlier released “flash” estimate of 64.8. The latest reading pointed to the third-fastest growth in business activity across the U.S. service sector since data collection began in October 2009, only slower than recent upturns in May and April, respectively.

Economists had forecast the index to stay unrevised at 64.8.

According to the report, rates of output and new order growth eased from May's record highs, while capacity constraints meant backlogs of work increased at the quickest rate for ten months. Although firms continued to hire new workers, challenges finding suitable candidates weighed on the pace of job creation. On the price front, input prices increased at the second-fastest rate on record as supplier price hikes and greater wage bills pushed up cost burdens, while output charges rose at the second-steepest rate on record, albeit with the rate of inflation cooling from May’s peak.