The key service side of the US economy, employment component doesn't corroborate Friday, price pressures reemerge

The January ISM services index rose to 53.4 from 50.5 and above the estimate of 52. New orders rose 2.2 pts to 55 which is about in line with the 6 month average of 54.5. Backlogs got back above 50 at 51.4 from 49.4. Inventories remained below 50, down .5 pt to 49.1. Post Friday's payroll, the employment component was up 6.7 pts but only after falling by 6.8 pts in December and it stands at just 50.5, not at all corroborating Friday's number. Also of note, ONLY THREE industries see growth in employment of 18 industries asked, down from 7 in December and 10 in November. Export orders jumped to 56.1 but only some service companies report them. 

Lastly, and as we look at potential supply delays for anything needing stuff to be shipped from the Mideast, Supplier Deliveries (goes up with supply strains and vice versa) were higher by 2.9 pts to 52.4, the highest since November 2022. In turn, prices paid jumped by 7.3 pts to 64 and that is the highest since February 2023. ISM said this on supplier deliveries, “More delays, with weather, shipping costs and backlog all playing roles” and “Slower transit times all around.”