Services PMI fell to 49.9 in June: Cooling service sector
• The purchasing managers’ index for the private service sector (Services PMI) fell in June to 49.9 from a downward revision of 52.8 in May, reaching the lowest level in six years. While individual months should be interpreted with caution, especially the summer months, the Services PMI is clearly trending downward, signaling a cooling Swedish service economy, says Jörgen Kennemar, who is responsible for PMI analysis at Swedbank.
• The sub-index for new orders was the biggest decliner in the Services PMI, dropping below the 50 mark for the first time in three years together with suppliers’ delivery times. The sub-index for business volumes also fell in June but is still in the growth zone together with employment, which was the only sub-index to rise in June.
• The index for intermediate goods prices at the supplier level fell to 55.5 in June from 57.4 in May. At the same time companies’ business plans dropped for the second consecutive month but remain at expansionary levels (63.4).
• Silf/Swedbank’s PMI Composite index fell to 50.5 in June from a downward revision of 52.9 in May, driven by the service sector. This means that business activity further decelerated in the second quarter and should be seen as a downside risk ahead of the upcoming GDP reading to be published at the end of July, says Jörgen Kennemar.
The Purchasing Managers’ Index (PMI) is a business cycle indicator for the Swedish economy produced by Swedbank in cooperation with Silf. The PMI is produced for both the manufacturing and service sectors. The aim of the PMI is to get a quick measure of the current state of the economy. Each month purchasing managers are surveyed and an index calculated. An index level above 50 indicates expansion, while a level below 50 signals a contraction. The PMI for the manufacturing sector is published on the first banking day of each month at 8:30 am (CET), while the corresponding index for the service sector is published on the third banking day of each month at 8:30 am (CET).
Next publication of Purchasing Managers’ Index – Services and PMI Composite: Monday, 5 August 2019
Jörgen Kennemar, Swedbank Public Affairs, tfn +4670 – 643 83 29, firstname.lastname@example.org
Anna Sjöblom, Silf, tfn +4673 – 518 70 11, email@example.com