Services PMI rose to 40.9 in May: Economic decline eased slightly
• The purchasing managers’ index for the private service sector (Services PMI) turned slightly higher in May to 40.9 from 39.0 in April after a big decline in March and April. Although the worst is probably now over for the Services PMI, there aren’t yet any clear signs of a speedy recovery in the service sector, as service companies’ business plans indicate, says Jörgen Kennemar, who is responsible for PMI analysis at Swedbank.
• The subindex for new orders saw the biggest monthly increase in May, but from record-low levels. New orders contributed 2.1 points to the Services PMI, followed by employment at 0.8 points. Suppliers’ delivery times fell in May after big increases in March and April, lowering the Services PMI by 0.8 points together with the subindex for business volumes.
• The index for service companies’ business plans registered 38.5 in May, remaining at historically low levels and indicating that an overweight of service companies expects lower business volumes.
• Silf/Swedbank’s PMI Composite index rose to 40.5 in May from 38.3 in April. The outlook for the Swedish private sector in the coming months still looks challenging, however, not least considering the low production and business plans that manufacturing and service companies have in the next six months, 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 May 14–24.
Next publication of Purchasing Managers’ Index – Services and PMI Composite: Friday,3 July 2020
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