Services PMI rose to 55.0 in October: Recovery is slowing down
• The purchasing managers’ index for the private service sector (Services PMI) rose a modest 0.3 points in October to 55.0 compared with September. The index is in line with the historical average but at the same time isn’t rising at the same rate as before. It is too early to say whether this is a sign that the recovery in the service sector is leveling off or not, but the risk of a slowdown in the service economy like we have already seen in the eurozone has increased, says Jörgen Kennemar, who is responsible for PMI analysis at Swedbank.
• Three of four subindexes contributed to the October increase. The subindex for employment was the biggest positive contributor to the Services PMI, followed by business volumes and delivery times, while the index for new orders swam against the tide and fell for the second month in a row.
• Service companies’ business plans remain upbeat despite increased uncertainty around the coronavirus pandemic. The index rose to 62.3 in October, the highest level since February of this year.
• Silf/Swedbank’s PMI Composite index increased to 55.9 in October from 55.0 in September. This is the fifth consecutive month that the total index is in the growth zone, suggesting a continued robust recovery in the Swedish economy driven by manufacturing, 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 10–27 October.
Next publication of Purchasing Managers’ Index – Services and PMI Composite: Thursday, 3 December 2020
Jörgen Kennemar, Swedbank Public Affairs, tfn 070 – 643 83 29, firstname.lastname@example.org
Anna Sjöblom, Silf, tfn 073 – 518 70 11, email@example.com