US services sector activity slows in April

US services sector activity slowed in April, but last month saw the sharpest rise in service sector payroll numbers since June 2014.

The latest flash reading on service sector activity from Markit Economics came in at 57.8.

Economists were expecting the index to slip to 58.2 from 59.2 in March.

Last month, it beat expectations for a reading of 58.6.

Chris Williamson, chief economist at Markit, wrote in the release: "The service sector enjoyed strong growth at the start of the second quarter, adding to evidence that the economy remains in good health. Although the pace of expansion slowed compared to March, April saw the second-largest rise in business activity for seven months."

Service sector companies are generally upbeat about the economy, with positive sentiment at its highest level since January.

Williamson added: "The improvement in second quarter economic growth, rising price pressures and strong job creation signalled by the PMI surveys adds to pressure on the FOMC to consider starting the process of normalizing monetary policy sooner rather than later at its meeting later this week."

Cost inflation climbed to a six-month high, according to Markit.

More to come...