PMI rose to 51.5 in January – more signs of manufacturing recovery
• The PMI rose in January to 51.5 from 47.7 in December. It is the first time since August that the index is back in the growth zone. Signs of a recovery in Swedish manufacturing have increased at the start of 2020 in the wake of a brighter global outlook, although individual monthly outcomes should be interpreted with caution, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• The January increase was broad. The subindexes for new orders and production posted the biggest gains in January and contributed a combined 2.6 points to the PMI. The subindexes for employment and delivery times together contributed 0.7 points but are below the 50 mark, an indication of a weak recovery in manufacturing.
• The index for manufacturers’ production plans rose in January for the third month in a row to 55.2. This is a positive economic signal and is consistent with orders having begun to improve though from a low level, says Jörgen Kennemar.
• The index for prices of commodity and intermediate goods dropped to 44.3 in January from 45.6 in December, reaffirming weak price pressure in industry.
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, 2 March 2020
Jörgen Kennemar, Swedbank Public Affairs, tfn +4670- 643 83 29, email@example.com
Anna Sjöblom, Silf, tfn +4673 – 518 70 11, firstname.lastname@example.org