US service sector activity slows more than forecast in July

Growth in services activity in the States slowed last month amid flattening levels of activity across multiple sectors, according to the results of one of the most widely-followed surveys for the sector.

The Institute for Supply Management's service sector purchasing managers' index slipped from a reading of 57.4 for June to 53.9 in July.

Economists had anticipated a reading of 56.8.

A sub-index for new orders experience the largest decline, slipping from 60.5 to 55.1, while another linked to employment levels fell back from a reading of 55.8 to 53.6.

Price gains on the other hand accelerated, with the corresponding subindex up from 52.1 to 55.7.

Respondents from Management & Support services, Retail, Wholesale Trade, Health Care all reported flatter levels of activity although executives in the former were looking forward to a ramp-up in activity in Autumn.

In falling below the 54.6 point mark seen in October, before the last presidential contest, it also reflected that the post-election surge in sentiment had now been fully washed out, Barclays Research said.

Nonetheless, according to Barclays Thursday's report was consistent with a modest rate of economic expansion over the third quarter.