The PMI-Total (Purchasing Managers Index) remained unchanged in February at 47.0, marking the seventh consecutive month that the index has been outside the growth zone. According to Swedbank’s Jörgen Kennemar, who is responsible for analyzing the Purchasing Managers Index, the conclusion is that the manufacturing sector has bottomed out.
"There are more signs that the industrial economy is bottoming out, while production plans are on the rise," he says in a statement.
An analysis of February’s index shows that the sub-indices for new orders, production, and inventories contributed positively to the overall PMI but were dragged down by the sub-index for delivery times, which reached its lowest level since 2009. At the same time, employment fell below the 50-point mark for the first time in two years. The index for production plans continues to rise, reaching 61.2 in February—the highest level in nine months. This marks the third consecutive month of growth for the index, indicating a more positive outlook on growth prospects for the next six months despite continued global uncertainty. The index for raw material and input prices fell in February to 52.7, the lowest level in over two years. Lower global commodity prices and more efficient supply chains have likely contributed to the easing of price pressure from suppliers, which in the long term raises hopes for lower inflation in 2023.
The Purchasing Managers’ Index (PMI) is a business cycle indicator for the Swedish economy, compiled in collaboration between Swedbank and Silf for both the manufacturing industry and the service sector. The goal of the PMI is to quickly gauge current economic conditions. Each month, economic data is collected from purchasing managers who are part of a survey panel. An index reading above 50 indicates growth, while a reading below 50 signals a decline. The Purchasing Managers’ Index for the manufacturing sector is published on the first banking day of each month at 8:30 a.m., and the Purchasing Managers’ Index for the service sector is published on the third banking day of each month at 8:30 a.m. The survey was conducted between February 7 and 23.
