The ISM Services Index declined to start 2022, as persistent labor and supply chain shortages weighed on the measure. The Overall Index now stands at an 11-month low, yet remains at very strong historical readings near 60% – with no apparent recession in sight.
While demand in the service sector has eased significantly in the past few months, the Prices Paid Index has held firm near record levels. These resilient pricing pressures reinforce the outlook for the first Federal Reserve rate hike in March… with the probability of 3-5 more to follow through the year.
