PMI dropped to 50.9 in April: Weak start to the second quarter
• The PMI fell to 50.9 in April compared with 52.5 in March. It was a broad decline with three of five sub-indexes contributing to the downturn. While this indicates a further slowdown in manufacturing activity, individual monthly outcomes should be interpreted with caution, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• For the second consecutive month the sub-index for new orders dropped, which is also beginning to have an impact on hiring. The sub-index for employment fell below the 50-mark in April for the first time since March 2018, negatively contributing to the total index along with new orders and manufacturers’ inventories.
• Production plans were reduced in April, but with an index reading of 61.7 there is still an overweight of companies that expect to increase production in the next half year.
• The index for prices of commodity and intermediate goods was unchanged in April (50.8) compared with March. Since April 2018 the index has fallen no less than 19.5 points. The impression that price pressure is easing at the supplier level remains despite a weaker krona, 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 the Purchasing Managers’ Index: Monday, 3 June 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