The ISM Services Index came in at 53.8 in January, unchanged at a 14‑month high first reached in December (chart). The headline strength last month overstated the pickup in demand: new orders shot up, but the rise mainly reflected an unusual dynamic in which fewer firms were reporting declines rather than more firms reporting improvement. That normalized a bit in January. New orders slipped 3.4 points to 53.1, still consistent with an expansion in demand but more in line with underlying conditions than the pop last month suggested (chart). The select respondent comments struck a slight-tone of optimism for the year. ... (full story)