Services PMI fell to 56.6 in December: Slowdown in the economy
• The purchasing managers’ index for the private service sector (Services PMI) registered 56.6 in December after a downward revision to 58.3 in November. The index retreated for the first time since September, but for the fourth consecutive month is above the historical average (55.4). While activity slowed in December, the service economy remains robust, probably supported by service companies with close ties to manufacturing, says Jörgen Kennemar, who is responsible for PMI analysis at Swedbank.
• All subindexes dropped in December. The subindex for business volumes was the biggest negative contributor to the Services PMI, followed by delivery times and new orders. Employment remains outside the growth zone, suggesting a downbeat hiring climate in the service sector.
• The trend toward rising business plans is continuing. In December, the index rose to 65.8, a higher level than before the coronavirus pandemic.
• Silf/Swedbank’s PMI Composite rose marginally in December and reached 58.9, compared with 58.8 in November. This marks the third straight month that the index has risen, increasingly driven by manufacturing, while the service sector has lost momentum in the last quarter, indicating an increased bifurcation of the business sector, 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). The survey for the Services PMI was conducted between 10–21 December.
Next publication of Purchasing Managers’ Index – Services and PMI Composite: Wednesday, 3 February 2021
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