Service sector grows at fastest pace since mid-2022: ISM

Economic Growth - The services sector is experiencing significant growth, with new orders, business activity, and new export orders reaching their highest levels since 2024 [3] - The Federal Reserve Bank of Atlanta forecasts a 3% annual growth rate for GDP in Q1 2026, following a positive ISM report on manufacturing [4] - Manufacturing activity showed improvement, with eight out of twelve Fed districts reporting growth and two reporting declines [5] Manufacturing Sector - The ISM manufacturing index slightly decreased to 52.4 from 52.6 but remains above the expansion threshold [6] - A notable increase in prices paid by manufacturers surged by 11.5 points to 70.5, marking the highest level since June 2022 [6] Services Sector - The service sector grew at its fastest pace since mid-2022, driven by a 5.5 percentage point increase in new orders and a 2.5 percentage point rise in business activity [7] - Fourteen industries, including real estate, mining, and information, reported growth, while only three experienced contraction [7] - The service sector has stabilized after facing high tariffs, with companies adapting to changes in tariff policies without significant supply chain disruptions [7]