PMI rose to 47.3 in June – rebound after the spring swoon
• The PMI rose in June by 7.3 points to 47.3 from an upward revision of 40.0 in May. This means that a large share of the index’s spring decline has been recouped, indicating that the trough in manufacturing activity has been passed. The big increase in June should be seen, however, as a rebound after an exceptionally severe downturn this spring, also supported by the easing of coronavirus restrictions, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• The June increase in the PMI was driven by the subindexes for new orders and production, though still from historically low levels. On the other hand, the subindex for delivery times lowered the PMI for the second month in a row and the index has fallen by 16.3 points since peaking in April. Easing supply problems for Swedish manufacturers as several countries have opened previously shut borders seem to have reduced suppliers’ delivery times, says Jörgen Kennemar.
• Manufacturing industry’s production plans for the next six months turned more optimistic in June and the index rose to 49.9 from 39.5 in May. Since bottoming out in April, the index has risen by 26 points, which is a positive economic signal.
• Price pressure at the supplier level remains weak even though the index rose in June compared with May to 42.2.
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). The survey for June was conducted between June 8–25.
Next publication of the Purchasing Managers’ Index: Monday, 3 August 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