Research Team at Nomura, notes that the Institute for Supply Management (ISM) reported that its headline non-manufacturing index declined by 2.3pts in January to 53.5, below expectations (Nomura: 56.0, Consensus: 55.1). Key Quotes “This is the lowest level since February 2014. Non-manufacturing data have held up well over the last year, but this subpar report suggests that some of the headwinds facing the industrial sector may be spilling over to the non-manufacturing sector. Although the mining and transportation & warehousing industries, which are closely related to the industrial sector, are categorized into the “nonmanufacturing” sector in the survey, other nonmanufacturing industries showed deceleration in growth. This places downside risk on the economic outlook, especially given our expectation for sectors outside the industrial sector to drive economic activity in the first half of this year. That said, the potential weakness in the non-manufacturing sector does not signal that a recession is imminent.” For more information, read our latest forex news.