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Purchasing Managers' Index Services - April 2012

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Purchasing Managers' Index Services - April 2012: Services PMI drops to 48.6 in April – recovery of the service economy comes to a halt

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Purchasing Managers' Index Services - April 2012

  1. 1. Purchasing Managers’ Index – Services May 4, 2012Services PMI drops to 48.6 in April – recovery of the serviceeconomy comes to a halt  The purchasing managers’ index for services (Services PMI) dropped by 4 index points to 48.6 in April compared to 52.6 in March, which is the first time since last November that growth in the service sector has halted. Monthly fluctuations should be taken with a grain of salt, but the PMI levels for the past three months (February – April) indicate an anemic recovery compared to the preceding three month period.  All component indices fell in April. The index for business activity was responsible for the largest negative contribution, followed by the index for new orders. Supplier delivery times is the only component index in the Services PMI that remained in the growth zone, though it dropped as well.  Service companies’ appetite for hiring continues to flag, pushing the employment index to a lower level in April than we’ve seen in over two years. Production plans have been scaled down, but a majority of companies still plan for increases in production. This indicates that service companies have a more positive outlook for the next six months than they have had in recent months.  The index for supplier intermediate goods prices dropped from 53.8 in March to 52.1 in April. This indicates that pressure to increase prices in the service sector has leveled off, which is consistent with the weaker demand scenario. Services PMI (Purchasing Managers’ Index - Services) Seasonally adjusted 2012 Apr. 48.6 Mar. 52.6 Feb. 54.1 Jan. 54.4 Dec. 51.1 Nov. 49.0 Oct. 49.1 Sep. 51.2 Aug. 53.5 Jul. 54.1 Jun. 53.3 May 56.4 Apr. 60.8 Next publication of Services PMI: Tuesday, June 5, 2012 Jörgen Kennemar Swedbank, Economic Research Department, +46 (0)8-5859 7730 1 (4) Administration, +46 (0)8-5859 7740, ek.sekr@swedbank.se Sebastian Bergfelt, Silf, +46 (0)73-944 6450, professionals@silf.se
  2. 2. Silf/Swedbank’s Purchasing Managers’ Index Service Sector, seasonally adjusted Components of PMI Other indicies Forecast Total index Business Delivery New Employ- Back -log Prices Planned activity times orders ment of orders business activity 2006 okt 61.8 68.1 55.3 62.9 58.5 56.6 54.9 68.3 nov 64.4 65.8 62.2 63.7 66.0 60.6 55.8 73.6 dec 67.5 71.9 59.9 68.4 67.9 58.8 53.2 75.4 2007 jan 65.7 70.4 61.0 66.8 62.7 62.2 57.8 73.9 feb 62.2 69.8 60.1 62.0 55.4 61.7 60.1 69.7 mar 58.9 59.9 54.5 61.1 58.2 56.2 55.8 68.0 apr 66.1 73.4 59.6 69.7 57.4 64.6 57.9 66.5 maj 60.5 61.8 59.4 61.6 58.2 65.9 59.9 66.4 jun 62.5 62.4 57.3 65.0 63.4 62.5 55.3 63.7 jul 60.2 63.7 61.2 61.0 53.5 60.0 58.5 64.9 aug 57.1 58.1 58.9 55.1 57.6 53.2 58.5 61.2 sep 58.6 59.7 57.6 55.8 63.3 57.7 52.9 62.9 okt 57.7 56.7 57.0 57.3 60.5 53.8 57.5 70.1 nov 61.3 67.5 55.5 61.8 58.5 59.4 61.5 55.3 dec 62.2 67.0 57.2 61.3 62.9 64.9 62.1 60.4 2008 jan 57.3 59.5 52.7 55.8 61.8 55.1 63.2 67.5 feb 55.9 56.3 54.3 57.9 53.5 58.8 61.2 63.9 mar 54.0 53.3 52.1 53.3 58.3 52.0 59.2 70.7 apr 52.7 53.6 48.8 49.7 60.7 53.1 56.1 61.7 maj 60.4 68.2 50.4 57.1 66.3 55.5 56.2 63.7 jun 52.4 55.9 49.7 47.9 58.8 45.8 63.8 63.8 jul 53.2 57.4 45.4 49.3 62.5 44.8 66.3 59.6 aug 50.6 53.1 49.4 45.6 57.4 49.3 57.4 61.0 sep 52.5 56.9 48.0 47.7 60.2 39.3 58.2 57.2 okt 43.0 44.9 46.0 36.1 49.8 44.9 58.2 49.2 nov 44.4 44.3 50.2 37.7 50.4 36.5 53.6 43.4 dec 38.2 37.8 40.0 36.8 39.5 37.2 45.2 40.5 2009 jan 34.8 32.8 42.4 34.6 30.2 27.2 48.6 33.9 feb 37.7 36.4 38.8 35.3 42.4 34.8 47.4 40.5 mar 40.2 43.3 41.2 41.8 32.5 38.6 48.1 36.0 apr 40.1 41.4 38.6 40.1 40.2 39.0 42.6 46.3 maj 40.4 43.9 42.4 43.3 28.9 38.0 40.6 43.9 juni 41.8 43.4 40.1 46.4 33.5 44.2 35.3 51.4 juli 42.6 44.9 38.2 47.2 36.1 42.6 40.2 54.9 aug 45.8 51.4 40.8 50.6 35.3 47.6 45.7 56.0 sep 49.1 53.3 46.1 56.0 34.9 54.8 49.4 59.6 okt 55.7 62.8 47.5 63.4 41.4 63.3 45.2 62.3 nov 51.8 57.1 48.4 57.5 38.9 57.7 44.7 68.3 dec 47.6 52.6 46.9 49.7 38.4 48.7 52.4 61.5 2010 jan 54.7 59.0 50.8 58.3 47.1 55.1 48.6 61.8 feb 60.4 63.1 54.0 66.9 52.1 60.9 46.4 74.9 mar 61.0 64.4 58.1 63.2 55.7 59.8 55.8 71.1 apr 62.4 66.6 60.5 64.6 55.4 61.1 60.3 73.9 maj 59.1 60.0 59.4 60.2 55.6 58.6 62.4 68.9 juni 59.7 61.3 62.1 61.2 52.7 61.3 62.0 69.0 juli 63.0 66.4 61.1 65.9 55.4 63.0 63.1 71.3 aug 64.0 66.4 61.9 67.8 56.6 64.0 62.2 70.7 sep 61.4 60.1 64.8 64.4 54.7 60.7 63.7 74.3 okt 64.3 65.9 62.0 68.2 58.0 62.0 60.5 77.5 nov 64.6 65.5 59.3 68.3 62.6 64.6 65.8 78.6 dec 66.0 69.8 64.7 65.7 62.8 60.9 63.6 77.1 2011 jan 65.1 70.2 61.3 65.1 62.6 63.6 67.1 77.9 feb 61.5 61.7 62.6 60.6 61.7 58.5 69.0 69.2 mar 60.4 63.8 60.2 58.4 60.0 55.2 64.5 68.9 apr 61.1 63.2 59.8 61.5 59.1 58.2 65.2 67.4 maj 56.4 55.8 58.1 55.1 57.7 50.2 59.9 67.0 juni 53.3 58.4 54.6 47.9 55.1 48.0 57.5 62.1 juli 54.1 54.9 55.6 52.3 54.7 53.2 54.1 62.1 aug 53.5 53.7 55.4 53.3 51.7 49.3 55.0 59.5 sep 51.2 52.3 51.7 48.1 54.7 47.8 54.2 57.4 okt 49.0 48.8 51.0 45.4 53.7 45.7 52.8 53.7 nov 49.0 50.0 49.3 46.9 51.0 45.8 53.6 54.4 dec 51.1 50.7 50.6 50.7 52.8 47.7 54.3 57.8 2012 jan 54.4 54.3 50.8 56.5 54.5 55.6 55.1 59.0 feb 54.1 57.2 50.1 54.1 54.0 48.2 53.9 60.7 mar 52.6 54.2 52.6 52.4 51.1 51.4 53.8 61.2 apr 48.6 47.7 51.5 47.3 49.3 48.1 52.1 56.9 2 (4)
  3. 3. Silf/Swedbank’s Purchasing Managers’ Index Service Sector, orginal Components of PMI Other indicies Forecast Total index Business Delivery New Employ- Back -log Prices Planned activity times orders ment of orders business activity2007 jan 60.9 63.3 58.3 62.2 58.2 57.1 59.2 71.4 feb 61.7 68.9 60.0 62.2 53.3 64.0 61.1 71.1 mar 60.6 63.4 52.4 64.6 58.5 59.8 56.1 69.5 apr 68.7 76.2 59.5 73.8 59.5 67.9 59.5 70.2 maj 63.8 66.3 60.5 65.1 61.6 69.8 62.8 70.9 jun 68.0 69.0 60.7 70.2 70.2 66.7 57.1 67.1 jul 56.1 56.3 64.1 53.1 53.1 53.1 59.4 65.6 aug 58.8 60.0 57.8 57.8 60.2 55.6 57.8 60.2 sep 60.4 63.1 58.1 58.1 63.4 58.1 53.5 61.6 okt 56.7 55.6 57.8 55.6 59.1 52.2 55.6 67.8 nov 59.1 65.8 55.3 57.9 56.6 55.3 57.9 51.3 dec 58.4 62.5 54.7 57.8 57.8 62.5 57.8 56.32008 jan 52.5 52.4 50.0 51.2 57.3 50.0 64.6 65.0 feb 55.3 55.4 54.2 58.1 51.4 61.1 62.2 65.3 mar 55.8 56.8 50.0 56.8 58.6 55.6 59.5 72.2 apr 55.2 56.4 48.7 53.8 62.8 56.4 57.7 65.4 maj 63.6 72.7 51.5 60.6 69.7 59.4 59.1 68.2 jun 58.0 62.5 53.1 53.1 65.6 50.0 65.6 67.2 jul 49.1 50.0 48.3 41.4 62.1 37.9 67.2 60.3 aug 52.3 55.0 48.3 48.3 60.0 51.7 56.7 60.0 sep 54.3 60.3 48.5 50.0 60.3 39.7 58.8 55.9 okt 42.0 43.8 46.8 34.4 48.4 43.3 56.3 46.9 nov 42.2 42.6 50.0 33.8 48.5 32.4 50.0 39.4 dec 34.4 33.3 37.5 33.3 34.4 34.8 40.9 36.42009 jan 30.0 25.7 39.7 30.0 25.7 22.1 50.0 31.4 feb 37.1 35.5 38.7 35.5 40.3 37.1 48.4 41.9 mar 41.9 46.8 39.1 45.3 32.8 42.2 48.4 37.5 apr 42.7 44.2 38.5 44.2 42.3 42.3 44.2 50.0 maj 43.6 48.4 43.5 46.8 32.3 41.9 43.5 48.4 juni 47.3 50.0 43.5 51.6 40.3 48.4 37.1 54.8 juli 38.5 37.5 41.1 39.3 35.7 35.7 41.1 55.6 aug 47.5 53.3 39.7 53.3 37.9 50.0 45.0 55.0 sep 50.9 56.7 46.6 58.3 35.0 55.2 50.0 58.3 okt 54.7 61.7 48.3 61.7 40.0 61.7 43.3 60.0 nov 49.7 55.4 48.2 53.6 37.0 53.6 41.1 64.3 dec 43.7 48.1 44.4 46.2 33.3 46.3 48.1 57.42010 jan 49.9 51.9 48.1 53.7 42.6 50.0 50.0 59.3 feb 59.8 62.2 53.9 67.1 50.0 63.2 47.4 76.3 mar 62.7 67.9 56.0 66.7 56.0 63.4 56.1 72.6 apr 65.0 69.4 60.4 68.7 57.5 64.4 61.9 77.6 maj 62.3 64.5 60.5 63.7 59.0 62.5 65.3 73.4 juni 65.2 67.9 65.5 66.4 59.5 65.5 63.8 72.4 juli 58.9 59.0 64.0 58.0 55.0 56.1 64.0 72.0 aug 65.8 68.3 60.8 70.5 59.2 66.4 61.5 69.7 sep 63.2 63.5 65.3 66.7 54.8 61.1 64.3 73.0 okt 63.4 64.8 62.8 66.5 56.6 60.4 58.6 75.2 nov 62.5 63.8 59.1 64.4 60.7 60.5 62.2 74.6 dec 62.1 65.3 62.2 62.2 57.7 58.5 59.3 73.02011 jan 60.3 63.1 58.6 60.5 58.1 58.5 68.5 75.4 feb 60.9 60.8 62.5 60.8 59.6 60.8 70.0 70.6 mar 62.2 67.3 58.1 61.9 60.3 58.8 64.8 70.4 apr 63.6 66.0 59.7 65.6 61.2 61.5 66.8 71.1 maj 59.6 60.3 59.2 58.6 61.1 54.1 62.8 71.5 juni 58.8 65.0 58.0 53.1 61.9 52.2 59.3 65.5 juli 50.0 47.5 58.5 44.4 54.3 46.3 55.0 62.8 aug 55.2 55.6 54.3 56.0 54.3 51.7 54.3 58.5 sep 53.0 55.7 52.2 50.4 54.8 48.2 54.8 56.1 okt 48.0 47.7 51.8 43.7 52.3 44.1 50.9 51.4 nov 46.8 48.3 49.1 43.0 49.1 41.7 50.0 50.4 dec 47.2 46.2 48.1 47.2 47.7 45.3 50.0 53.72012 jan 49.6 47.2 48.1 51.9 50.0 50.5 56.5 56.5 feb 53.5 56.3 50.0 54.3 51.9 50.5 54.9 62.1 mar 54.4 57.7 50.5 55.9 51.4 55.0 54.1 62.7 apr 51.2 50.5 51.4 51.4 51.4 51.4 53.7 60.6 3 (4)
  4. 4. Silf/Swedbank’sPurchasing Managers’ Index – Services- objectives and methodologyHistory Silf and Swedbank AB publ. made the first joint – internal – calculation of the “Purchasing Managers’ Index” for the service sector of the four indexes (PMI) during 2005. The model for PMI – Services is the U.S. based Non-Manufacturing Index and the Swedish PMI, which has been published since November 1994Participants About 200 purchasing managers in the service sector.Publication Third weekday of each month, 8:30 am.Analysis Period Comparison with previous month.Compositionof PMI – Services (%) New orders (within the company) 35 Business activity (within the company) 25 Employment (within the company) 20 Suppliers’ Delivery Times 20Other leading indicators(not included in PMI – Services) Backlog of Orders Suppliers’ intermediate goods prices Planned business activity next six monthsObjective Quick economic indicator Simple statistics Statistics with relatively short publication intervals Constant contact with a well-informed professional groupCalculation According to “diffusion index”. Positive changes are noted in percent for the four sub indexes. The percentage of unchanged replies, multiplied by 0.5, is added to this figure. Then the different sub indexes are weighted as described above to reach the total index. The Purchasing Managers’ Index – Services does not indicate activity levels but rather monthly changes in activity in the service sector.“Break-even” The dividing line between growth and decline – in line with US praxis – has been drawn at a total index of 50. However, this boundary or “neutral growth zone” should not be applied excessively. Rather, “Break-even” at 50 indicates a target value. We believe we have used reliable sources and procedures to generate and analyze the Purchasing Managers’ Index (PMI – Services). However, Swedbank AB (publ) and SILF (earlier Organisationen för Inköp och Logistik, /I&L/ – The Organization for Purchasing and Logistics) cannot guarantee the accuracy or completeness of the analyses and cannot be responsible for any errors or omissions in the basic data or processing thereof. The reader should base any decisions on other background material as well. Swedbank AB (publ), SILF. their employees, and other coworkers accept no liability whatsoever for any direct or consequential loss or injury of any kind arising from any errors or omissions in the analyses presented in the Purchasing Managers’ Index – Services. 4 (4)

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