Economic activity in the non-manufacturing sector grew in February for the 86th consecutive month, the Institute of Supply Management said on Friday.
The institute's non-manufacturing index hit 57.6 in February, up from 56.5 in the previous month.
Economist expected the ISM's non-manufacturing index to hit 56.5 in February, according to a consensus estimate from Thomson Reuters.
A reading above 50 on this index indicates expansion in the service sector, and a reading below 50 indicates contraction.
"Respondents' comments continue to be mixed, with some uncertainty; however, the majority indicate a positive outlook on business conditions and the overall economy," Anthony Nieves, chair of the ISM, said in Friday's report.
The non-manufacturing business activity index increased to 63.6 percent for the month, 3.3 percentage points higher than a January reading of 60.3 percent. This is the highest reading since February 2011.
The new orders index registered 61.2 percent, 2.6 percentage points higher than the reading of 58.6 percent in January. This is the highest reading since August 2015.
Sixteen of the non-manufacturing industries surveyed reported growth in February, the ISM's report said. Two industries — real estate, rental and leasing, and information — reported contraction.
A retail trade respondent surveyed told the ISM that business was "slow after the holiday," but there's a "positive year ahead."
A food services respondent mentioned the heavy rains in California impacting "the quality and availability of greens and lettuces" in the state. Prices have also increased, the respondent said.