US services sector misses expectations, tariff concerns hurt growth in July
The report says that President Donald Trump's tariffs and global trade tensions are key factors that impacted the growth of global industries this year.
The Institute for Supply Management (ISM) services index fell to 50.1 per cent in July, a slight decrease from 50.8 per cent in June. Although the figure remains above the 50 per cent mark, indicating growth, it missed the expected forecast of 51.5 per cent, the news report said.
"The Employment Index's continued contraction and faster expansion of the Prices Index are worrisome developments," ISM survey chair Steve Miller told AFP.
He further added that both the new exports and imports indexes moved from expansion to contraction territory, giving "signals that tariff tensions are impacting global trade".
"The most common topic among survey panelists remained tariff-related impacts, with a noticeable increase in commodities listed as up in price," Miller said.
The business activity index was in expansion but cooled from June's reading, so did the new orders index. However, the employment index remained in the contraction territory for the second straight month, the news agency reported.
"Anticipation of the final tariff impacts is resulting in delayed planning for next fiscal year purchases," said a respondent in the accommodation and food services sector.
Another respondent, in the agriculture industry, added that "higher tariffs are increasing the cost of imported feed ingredients and trace minerals for livestock and poultry feeds".
Carl Weinberg, chief economist at High Frequency Economics, commented that "a slowing trend in service sector output is a cause for concern."
Weinberg said the report supported the view of a gradually slowing economy, though he noted that it did not yet warrant monetary easing.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Today
3 minutes ago
- India Today
Trump says China could face India-style tariffs over Russian oil trade
US President Donald Trump on Wednesday said he may impose additional tariffs on China, similar to the 25 per cent duties announced earlier on India over its imports of Russian oil."Could happen," Trump told reporters, after saying that he expected to announce more secondary sanctions aimed at pressuring Russia to end its war in did not offer further This is a developing story. It will be updated.- EndsTune InMust Watch
India Today
3 minutes ago
- India Today
Trump warns of more secondary sanctions on India over oil imports from Russia
Hours after imposing an additional 25 per cent tariff on Indian imports, taking the total to 50 per cent, US President Donald Trump warned of more secondary sanctions on India over its continued purchase of oil from asked, "Indian officials have said there are other countries buying Russian oil, like China, for instance. Why are you singling India out for these additional sanctions?" Trump responded, "It's only been eight hours. So let's see what happens. You're going to see a lot more You're going to see so many secondary sanctions." advertisementEarlier in the day, the White House issued an executive order announcing an additional 25 per cent tariff on Indian imports, taking the total to 50 per cent. The revised duties are set to come into force on August 27 -- 21 days from the date of signing. This is a developing story. It will be updated.- EndsMust Watch
Economic Times
3 minutes ago
- Economic Times
100% tariff on chips and semiconductors? Trump plans big tech crackdown as firms race to build in U.S.
100% tariff on chips and semiconductors — that's the bold step Trump just proposed, targeting imported semiconductors to push companies to build in the U.S. This isn't just a policy shift—it's a potential shake-up for the entire tech world. The plan would slap a massive tariff on chips unless companies are already manufacturing or committing to build facilities in America. While some giants like Apple are moving fast with U.S. investments, others might face huge costs. Tired of too many ads? Remove Ads Why is the U.S. targeting chip imports with a 100% tariff? Tired of too many ads? Remove Ads Which companies could be impacted the most? Popular in International How will the tariff affect electronics and consumer prices? Is this a game changer for the U.S. chip industry? What does this mean for the global tech economy? Tired of too many ads? Remove Ads FAQs: President Donald Trump has announced a 100% tariff on all imported chips and semiconductors. This dramatic move is aimed at pressuring tech companies to bring semiconductor manufacturing back to the United States. With global tensions high and supply chains under strain, this policy marks a turning point not just for the U.S. economy—but for the entire global tech to trade data, the U.S. imported approximately $46.3 billion worth of semiconductors in 2024, making up nearly 1% of the country's total $3.35 trillion in goods imports. These numbers highlight just how critical imported chips are to the American economy—and how bold this new policy really new 100% semiconductor tariff is more than just a trade policy—it's a clear message. Trump wants to reduce America's dependency on foreign-made chips, especially those coming from Asia. Over 70% of the world's chips are currently produced in Taiwan, South Korea, and China, leaving the U.S. exposed to global disruptions and geopolitical tariff is designed to flip the script. Instead of relying on global factories, Trump wants companies to build chip facilities on American soil. It's a direct attempt to bring tech manufacturing back home—and it's happening giants like, andrely heavily on imported chips to power everything from iPhones to electric cars. But Trump has made one thing clear: companies that are already building or committing to build semiconductor plants in the U.S. will be exempt from the 100% for example, has already pledged a $100 billion investment in U.S.-based chip and component manufacturing—a strategic move to sidestep the penalty and strengthen its domestic supply chain. Others are expected to follow suit, fast-tracking plans to expand U.S. operations and avoid the steep immediate concern for consumers is price. Since most electronics—phones, laptops, TVs, cars—depend on chips, this tariff could quickly translate intoIf companies fail to localize chip production, they'll likely pass theonto customers. That means we could see price hikes in smartphones, EVs, gaming devices, and even home appliances. Industry analysts warn this couldin consumer tech fast. Unlike earlier policies like the CHIPS Act under Biden, which focused on incentives and subsidies, Trump's approach is based on pressure. It forces companies to act—not just say the 100% chip import tariff could accelerate billions in U.S. tech infrastructure, boost job creation in semiconductor hubs, and shift global supply chain priorities. However, some fear retaliation from trade partners or a rise in global tech isn't just a U.S. story—it's a global one. Countries that dominate chip exports—like Taiwan, South Korea, and China—may respond with their own measures. The tariff could intensify trade tensions, impact global production timelines, and force tech companies to diversify sourcing at a massive the U.S. market being one of the most lucrative for tech, no brand can afford to ignore this shift. We're already seeing a surge in factory announcements, investment deals, and reshoring plans, and it's just the has proposed a 100% tariff on all imported semiconductors unless companies are building or operating facilities in the companies manufacturing or committing to manufacture chips in the U.S. will be exempt from the new tariff.
