PMI rose to 53.1 in May: Stabilization in industrial activity
• The PMI rose to 53.1 in May compared with 50.9 in April, which is the highest level since November 2018. The downward trend in the PMI has been broken, suggesting that the Swedish industrial sector is stabilizing with help from a weak krona despite global uncertainty, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• The sub-index for new orders was the biggest contributor to the increase in the PMI, followed by inventory purchases and employment. The fact that the sub-index for suppliers’ delivery times has been stuck around the 50 mark four months in a row raises doubts about the strength of industrial production, however, notes Jörgen Kennemar.
• Corporate production plans were raised in May, and with an index reading of 63.1 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 rose in May to 51.5 from 51.0 in April. Although the index has stabilized in recent months, the impression of lower price pressure at the supplier level still remains. Compared with May 2018, the index has fallen by just over 20 points.
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, 1 July 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