PMI Services fell to 57.9 in May: Broad slide with emphasis on orders
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- The Purchasing Managers' Index for the service sector (PMI Services) fell to 57.9 in May from 60.3. The trend indicates that the rate of increase in the sector has topped out. The fall in May was mainly driven by new orders which contributed -1.8 index units. However, several components retreated to their lowest levels this year.
- The sub-index for business volumes fell to 59.8 in May, the first reading below 60 since October last year, contributing -0.7 index units to PMI Services; the decline is from a high level and the sub-index remains high. Planned business volumes rose by 0.2 index units to 64.8 in May. This is the second consecutive month with the index around this level, having previously fluctuated around 70.
- The new orders sub-index was 56.4 in May, which is 5.3 index units lower than in April. The index for order backlogs also fell to 53.3. Despite the retreats, both indicators have been in the growth zone for more than a year. Employment also continues to rise, as exhibited by a sub-index of 54.8.
- The index for prices of suppliers’ intermediate goods fell from 62.7 to 59.4 in May. Despite the fall, the trend of a rising pace of price increases continued.
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 purchasing managers’ index 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
purchasing managers’ index 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 Purchasing
Managers’ Index – Services: Wednesday, 5 July 2017
For more information, contact Ingrid Wallin Johansson, Swedbank Research phone 08 – 700 92 95, firstname.lastname@example.org or Anna Sjöblom, Silf, phone 073 – 518 70 11, email@example.com