The decline in the ISM non-manufacturing index to 53.5, from 55.8 is disappointing, particularly as it continues a sharp downward trend from the peak of 59.6 last July. Fed officials will be concerned that the weakness in manufacturing and mining is now “spilling over” into the rest of the economy, as it did ahead of the 2001 recession. Accordingly, any lingering prospects of a March rate hike appear to have faded further.
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