TD Securities forecasts a decline in the June ISM Services index, citing weaker activity, new orders, and persistent labor contraction.
The ISM Services index is expected to drop to 54.0 in June from May’s gain, reflecting broad-based slowing in U.S. activity and new orders. Employment likely remained in contraction, contributing to the decline.
May’s index rose by nearly 1 point, but consensus estimates for June stood at 54.2. Prices paid are also projected to fall, following a March-May surge tied to energy costs. Softer payrolls data, particularly in leisure and hospitality, further signal economic cooling.
Weaker economic signals have reduced market pricing for Federal Reserve rate hikes in 2026 and pressured long dollar positioning. Treasury yields declined as investors adjusted expectations.