By Colin Kellaher
Services activity in the middle of the U.S. expanded a bit in January following a slight drop in December, and expectations for future activity rose sharply, according to a monthly survey by the Federal Reserve Bank of Kansas City.
The Tenth District Services Survey's composite index, a weighted average of indexes covering revenue/sales, employment and inventory, came in at 8 for January, rebounding from a reading of minus 4 in December. Readings above zero indicate expansion, while those below zero indicate contraction.
The Kansas City Fed said most of its month-over-month indexes were positive in January, with the general revenue and sales index rising amid higher wholesale, retail, real-estate, professional and technical services, healthcare, and restaurant activity. However, the bank noted that auto, tourism and hospitality activity declined.
The Kansas City Fed said expectations for future services activity rose to 28 in January from 16 in December, reaching its highest level since last January.
The bank said nearly 90% of firms it surveyed indicated that widespread Covid-19 vaccination is important to their overall business outlook for the year, with 57% rating it as "very important."
The Kansas City Fed's survey includes participants from such service industries as retail and wholesale trade, automobile dealers, real estate and restaurants. The survey provides information on current services activity in the Tenth District, which includes Colorado, Oklahoma, Wyoming, Nebraska, Kansas, the northern half of New Mexico and the western third of Missouri.
The bank's monthly manufacturing survey, released Thursday, showed factory activity in the region expanded in January at a quicker pace than that of December.
Write to Colin Kellaher at colin.kellaher@wsj.com
(END) Dow Jones Newswires
01-29-21 1138ET
