The Institute for Supply Management (ISM) said on Wednesday its non-manufacturing PMI dipped to a reading on 56.7% in September from 56.9% in August. Economists polled by Reuters had forecast the non-manufacturing PMI falling to 56.0%.

Also, the ISM detailed that employment surged and a measure of prices paid by businesses for inputs dropped to over a 1-1/2-year low, suggesting underlying strength in the economy despite rising interest rates.

A reading above 50% indicates expansion in the services sector, which accounts for over two-thirds of U.S. economic activity.

Likewise, specialists stated the economy is slowing as the Federal Reserve aggressively tightens monetary policy to quell inflation.

The U.S. central bank has hiked its policy rate from the near-zero level at the beginning of this year to the current range of 3.00% to 3.25%, and last month signaled more large increases were on the way this year.

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