US services sector sees fastest expansion in new orders this year

New orders in the US services sector in June expanded at their fastest rate for a year, according to a report released by the US-based financial services company S&P Global on Wednesday.

"Growth momentum improved in the US service sector in June, with firms seeing sharper increases in both business activity and new orders," said the report.

Companies responded to growth of new business by increasing workforce numbers for the first time in three months, but backlogs of work built up nonetheless."

"Rates of increase in both input costs and output prices eased in June, but in each case remained above pre-pandemic averages," it added. "Higher labor costs were central to price rises."

The S&P Global US Services PMI Business Activity Index increased for the second consecutive month in June by standing at 55.3, following a reading of 54.8 in May.

Activity in the US services sector has now risen in each of the past 17 months, according to the report.