Service Sector Expands at Year-Best Rate

According to reports on Monday, the service sector expanded at its fastest pace in a year in February, although that is slightly offset by the fact that new orders for factory goods dropped in January.

said that, according to the Institute for Supply Management, the services index rose to 57.3 in February last month from 56.8 in January, which bests economist's expectations for a drop to 56.1. The rise saw the index at its highest level since the same month last year and, with the services sector accounting for approximately two-thirds of U.S. economic activity, that has to be good news for the U.S. economy. "It was overall a solid report," Tom Porcelli, chief U.S. economist at RBC Capital Markets in New York said, said to Reuters. “At this level of ISM, this is not really changing our view that you're still looking at around a 2.0 percent year in terms of GDP, but it is holding up and this is certainly what you want to see."