In October, the US non-manufacturing ISM weakened again after reaching a six-month high. The headline index fell from 55.1 to 54.2, slightly below the consensus which was looking for a drop to 54.5. The breakdown confirms the deterioration in sentiment as new orders (54.8 from 57.7), business activity (55.4 from 59.9), new export orders (47.5 from 50.5) and inventory change (46.5 from 48.5) weakened significantly, while inventory sentiment (64 from 65) and imports (49.5 from 50.0) eased slightly. Backlog of orders (49.0 from 48.0) and employment (54.9 from 51.1) improved in October. Supplier deliveries stabilized at 51.5, while upward price pressures eased somewhat as prices paid eased from 68.1 to 65.6. After an improvement in the third quarter, the US non-manufacturing ISM weakened again at the start of the fourth quarter, suggesting that business sentiment remains still fragile, probably due to the upcoming fiscal cliff.