US Services Activity Contracts for First Time in Nearly a Year

Activity at US service providers slipped into contraction territory last month for the first time in nearly a year on an abrupt pullback in demand, while prices accelerated as higher tariffs reverberated across the economy.

The Institute for Supply Management’s index of services dropped 1.7 points in May to 49.9, the group said Wednesday. Readings below 50 indicate contraction, and the latest figure was weaker than all but two projections in a Bloomberg survey of economists.