PMI fell to 58.8 in May – the fall continues
- The PMI fell by 3.7 points to 58.8 in May, down from 62.5 in April. The decline in PMI was broad-based as all sub-indices contributed negatively to the PMI, with the largest drops from new orders and employment components. Nevertheless, monthly changes in the PMI should be interpreted with some caution. At 62.2, a three-month moving average for the PMI remains above the 60 level, slightly lower than April’s recording of 62.9 for the three-month average.
- The sub-index for new orders fell by 5.2 points to 58.5 compared to 63.7 in April. Thereby, the sub-index represented the largest negative contribution to PMI. This was followed by the sub-index for employment, which fell to 59.2 and as such contributed 1.0 point to the fall in PMI, after April’s record-high of 64.1.
- The sub-index for production retreated by 2.7 points in May and was recorded at 60.0. Concurrently, business production plans were somewhat less expansionary in May. The index for production plans fell, for the second consecutive month, from 69.7 in April to 66.5 in May.
- The index for commodity and intermediate goods prices fell by 11.6 points to 55.8. As such it was the largest monthly fall since October 2008.
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 purchasing managers’ index 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 purchasing managers’ index 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: Monday, 3 July 2017
For more information, contact Jörgen Kennemar, Swedbank Research, phone 08- 700 98 04, firstname.lastname@example.org or Anna Sjöblom, Silf, phone 073 – 518 70 11, email@example.com