PMI dropped to 62.4 in January – down from a high level
• The PMI fell in January to 62.4 from a downward revision of 64.7 in December. While this is the first time in eight months that the index fell, it is still at high levels and far above the historical average (54.4). Swedish manufacturing activity remains high at the start of 2021, at the same time that companies’ production plans have become more upbeat, indicating an optimistic view of the economy in the next six months, says Jörgen Kennemar, who is responsible for analysis of the PMI at Swedbank.
• All subindexes in the PMI were down in January after the strong gains in December. The subindex for employment was the biggest contributor to the decline in the PMI with a drop of 1.1 points, followed by delivery times (0.5 points). New orders and production each lowered the index by 0.4 points.
• The index for manufacturers’ production plans continues to rise and is now at levels not seen since 2017, despite the ongoing pandemic. The index increased in January to 72.5 from 68.5 in December.
• The index for prices of commodity and intermediate goods rose to 78.4 in January, reaching the highest level since 2004. It is becoming increasingly clear that the higher activity in manufacturing industry and rising global commodity prices have led to increased price pressure at the producer level, which eventually could also have an impact at the consumer level, says Jörgen Kennemar
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 was conducted between January 10–27.
Next publication of the Purchasing Managers’ Index: Monday, 1 March 2021
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