Services Growth Accelerates as Prices Rise

U.S. services activity accelerated in August, with ISM’s index rising to 55.4 from 54.1. Business activity reached 61.7 and new orders 60.9, while employment remained in contraction at 47.8. The prices index climbed to 72.6, its highest since August 2022.

For the Fly High universe, stronger demand can support borrower revenues and earnings, the primary signal for dividend support. Persistent input costs can squeeze margins and keep rates restrictive, while elevated financing costs pressure borrowers and refinancing. For BDCs, high short rates may support asset income, but borrower interest expense remains a credit watch; mortgage REIT funding and book values remain sensitive to the rate path.

Friday’s employment report is the next test of whether activity can stay firm without renewing broader inflation pressure.

Sources

• Institute for Supply Management, August 2026 Services PMI, September 3, 2026
• U.S. Bureau of Labor Statistics, September 2026 release calendar

This article is general information, not personalized investment advice. Fly High Investing may hold securities discussed in this article.