The services sector, which accounts for nearly 90 percent of the U.S. economy, grew in April as increases in orders and sales signaled even faster growth ahead, Bloomberg reported.
Today, the Institute for Supply Management released its nonmanufacturing index, which rose to 55.2, its highest level since August 2013. The index stood at 53.1 in March. Readings above 50 indicate expansion. The ISM nonmanufacturing survey covers an array of industries including utilities, retail and health care, and also factors in construction and agriculture.
Industries ranging from retailers to restaurants and construction companies were among the 14 sectors reporting growth last month, as the U.S. economy rebounds from a weak first quarter, Bloomberg reported.
"The economy has started the quarter with a lot of momentum," said Markus Schomer, chief economist at PineBridge Investments LLC in New York, who projected the index would rise to 55. "We have moderate but accelerating growth, inflation is no longer falling, and the Federal Reserve is expected to keep rates very low for a very long time."
The ISM's gauge of business activity climbed to 60.9 in April from 53.4, the biggest increase since February 2008. Orders jumped to an eight-month high of 58.2 from 53.4.
Another report from London-based Markit Economics showed little change in growth at services in April. A final reading for the month eased last month to 55 from 55.3 in March. The gain in bookings from the prior month was the most since March 2010.