Mubasher: The US service sector growth picked up steam during August, recovering from July’s 3-year trough and indicating that a key segment of the world’s biggest economy is gaining traction.

The Institute for Supply Management’s (ISM) non-manufacturing purchasing managers index (NMI), which covers service-oriented firms such as banks, restaurants and hospitals, climbed to 56.1% last August from 53.7% in the previous month.

The upturn came after two months of sluggish performance in the sector.

The ISM’s services sector measure on business activity soared by 8.4% to 61.5% last month.

A barometer on new orders came in at 60.3% during August, jumping from the preceding month’s reading of 54.1%, despite foreign demand for US services eased month-on-month.

Consumer spending has been a major catalyst for the US growth, and around two-thirds of those outlays are on services.

The sub-gauge on prices charged by services providers rose to 58.2%.

By 2:14 pm GMT, the US dollar index fell by 0.22% to 98.23.