The U.S. service sector contracted in June, but at a slower pace than in May, according to a report released on Monday.

The Institute for Supply Management's services index rose to 47.0 last month from 44.0 in May, above economists' median forecast for a rise to 46.0. The dividing line between growth and contraction is 50.

The services sector represents about 80 percent of U.S. economic activity, including businesses such as banks, airlines, hotels and restaurants.

(Reporting by John Parry; Editing by James Dalgleish.)