PMI rose to 47.1 in December – Weak manufacturing activity continued
• The PMI rose in December to 47.1 from 45.7 in November. This marks the fourth month in a row that the index is outside the growth zone and means that activity in Swedish industry has continued to decline even though the downturn slowed in December. It is too early to say after a month whether the PMI has bottomed out despite glimmers of light, not least the subindex for production, which rose for the third consecutive month, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• All the subindexes positively contributed to the PMI in December but are still outside the growth zone, indicating continued weak activity in Swedish industry, notes Jörgen Kennemar. The subindexes for production and new orders together contributed 0.9 points to the upturn in the PMI, while the subindexes for employment, suppliers’ delivery times and inventories added 0.5 points.
• The index for manufacturers’ production plans rose in December for the second month in a row to 55.0. This is a positive economic signal even though the downside risks remain high, says Jörgen Kennemar.
• The weak price pressure in manufacturing persists despite that the index for prices of commodity and intermediate goods increased to 45.9 in December from 41.7 in November. It was the fourth consecutive month that the index was below the 50 mark, i.e. an overweight of companies are reporting falling prices.
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 February 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