The Institute for Supply Management (ISM) reported on Thursday its non-manufacturing index (NMI) came in at 56.4 in August, which was 2.7 percentage points higher than the July reading of 53.7 percent. The August reading pointed to the fastest expansion in the services sector since May.

Economists forecast the index to increase to 54.0 last month. A reading above 50 signals expansion, while a reading below 50 indicates contraction.

The 16 non-manufacturing industries reported growth last month, the ISM said, adding that respondents remain concerned about tariffs and geopolitical uncertainty but are mostly positive about business conditions.

According to the report, the ISM’s non-manufacturing business activity measure rose to 61.5 percent, 8.4 percentage points higher than the July reading of 53.1 percent. That reflected growth for the 121st consecutive month, at a faster rate in July. The new orders gauge increased to 60.3 percent, 6.2 percentage points higher than the reading of 54.1 percent in July. The Prices Index advanced 1.7 percentage points from the July reading of 56.5 percent to 58.2 percent, indicating that prices increased in August for the 27th consecutive month. Meanwhile, the employment indicator fell 3.1 percentage points in August to 53.1 percent from the July reading of 56.2 percent.