The overall PMI rose in November to 49.0 from 46.2 in October, marking the highest level since September 2022. According to Swedbank, this is a surprisingly large increase, indicating that the decline in the manufacturing sector has slowed during the fourth quarter of 2023.
“It is likely that we have not yet seen the full impact of interest rate hikes and the decline in global trade on Swedish industry, with the risk of a setback down the road,” says Jörgen Kennemar, head of analysis for the Purchasing Managers’ Index at Swedbank.
The sub-index for new orders accounted for the largest monthly contribution to the increase in the overall PMI (1.4 index points), followed by employment (0.9 index points), production (0.3 index points), and inventory purchases (0.2 index points). Manufacturing companies’ production plans declined in November, with the index standing at 53.0 compared with 54.9 in October. However, these plans are clearly less expansionary than last year, yet there is still a majority of companies planning to increase production rather than decrease it, despite a weaker global economic environment. The index for suppliers’ raw material and input prices rose in November to 47.1 from 43.8 in October.
“Price pressure in the industrial sector continues to decline, but not to the same extent as before, as the index is rising—which may be a result of the krona’s depreciation over the course of the year,” says Jörgen Kennemar.
The Purchasing Managers Index (PMI) is an economic indicator for the Swedish economy that is compiled in collaboration between Swedbank and Silf for both the manufacturing industry and the service sector. The purpose of the PMI is to provide a quick assessment of current economic conditions.
