The US service sector contracted less severely than expected in December, according to a report released today.
The Institute for Supply Management said its non-manufacturing index came in at 40.6 in December versus November's 37.3.
The level of 50 separates expansion from contraction. The index dates back to July 1997.
Economists had expected a reading of 37, according to the median of 56 forecasts in a Reuters poll, which ranged from 34.5 to 42.
The service sector represents about 80 per cent of US economic activity, including businesses such as banks, airlines, hotels and restaurants.
Like the service sector, manufacturing is also depressed, as the deepening year-old recession continues to hammer the world's largest economy.
US factory activity fell to a 28-year low in December, the Institute for Supply Management said on Friday, producing a bleak outlook for the start of 2009.
Reuters