The pace of growth in the US service sector rose in December as new orders strengthened and prices paid fell, according to a report published today.
The Institute for Supply Management's services index rose to 59.8 in December from 58.5 in November - above Wall Street's median forecast for a rise to 59.0.
A number above 50 indicates growth in the sector, which accounts for about 80 per cent of U.S. economy activity and includes businesses such as restaurants, hotels, hair salons, banks and airlines.
The survey's prices-paid index fell to 69.5 from 74.2 in November, while the jobs component rose slightly to 57.1 from 57.0, and new orders climbed to 61.9 from 59.5.
"The service part of the economy continues to expand," said Lynn Reaser, chief economist at Banc of America Capital Management in Boston. "There is also relief in the prices paid component from lower energy costs."
Although the prices paid component did fall, ISM cautioned it remained at historically high levels.
US Treasury debt prices were trading little changed after the release of the data, with the benchmark 10-year note steady in price for a yield of 4.35 per cent.