Makit, Concerns Over 'Double Dip' Despite US Service PMI Entering Expansion Phase (Comprehensive)

Entering Service Sector Expansion After 6 Months Despite Worsening Concerns
"Reflecting Economic Impact Indicators of COVID-19 Resurgence"

[Asia Economy New York=Correspondent Baek Jong-min] Although the service sector, which accounts for two-thirds of the U.S. economy, has entered an expansion phase, concerns have been raised that the possibility of a 'double dip,' indicating further economic deterioration, is high.

On the 5th (local time), research firm IHS Markit announced that the U.S. service sector PMI for July was 50.0. It was 47.9 the previous month. This was even higher than the expert forecast of 49.6. It is the first time in six months that the U.S. service PMI has exceeded 50. A PMI above 50 indicates economic expansion.

Markit explained that the service sector showed signs of stabilizing after escaping the worst situation caused by COVID-19 in the second quarter, but expressed concerns about the possibility of deterioration again.

Markit noted that the U.S. is the only major country to have re-entered economic activity restrictions amid the resurgence of COVID-19, and that the current situation is reflected in the indicators, raising concerns about the possibility of a 'double dip.'