PMI fell to 52.0 in June: Weak finish to the second quarter
• The PMI dropped to 52.0 in June compared with 53.1 in May. This marks the second largest decline so far this year, and even though the PMI has trended sideways in recent months, the downside economic risks have remained high, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• The decrease in June was broad with four of five subindexes negatively contributing to the PMI. The sub-index for new orders saw the biggest decline, followed by suppliers’ delivery times, inventories and employment. The exception was the sub-index for production, which rose for the second month in a row.
• Corporate production plans are still optimistic despite that the index dropped to 60.2 in June from 62.6 in May. An overweight of companies expects to increase production in the next half year. It seems as if geopolitical turmoil and weaker global economic signals to date haven’t had a major impact on corporate plans, says Jörgen Kennemar.
• The index for prices of commodity and intermediate goods fell in June to 47.9 from 50.6 in May, reaching the lowest level since March 2016. The outcome suggests that price pressure further eased at the supplier level, and compared with June 2018 the index has fallen by 23.8 points despite the weaker Swedish krona.
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: Thursday, 1 August 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