Swiss purchasing managers’ indices just below growth threshold
Published: Tuesday, Oct 1st 2024, 09:50
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The managers responsible for purchasing at Swiss industrial companies became slightly more optimistic again in September. However, the opposite trend was seen in the service sector.
The Purchasing Managers' Index (PMI) for industry rose by 0.9 points to 49.9 points in September (seasonally adjusted). It thus remains, albeit only just, below the growth threshold: PMI values above 50 points indicate growth and values below indicate a decline. However, with the latest increase, the index has reached its highest level since December 2022 - the last time it was above the growth threshold, at 54.1 points.
The improvement in September was partly due to an improvement in order backlogs, UBS announced on Monday. The major bank publishes the index together with the purchasing and supply management association Procure. Production also contributed to the positive momentum for the industry, despite a slight decline.
Meanwhile, the component of delivery times rose above the growth threshold for the first time since December 2022. However, the rise in this component should be viewed with caution, as the increase could indicate both higher demand and more supply chain problems, according to UBS.
On a positive note, the employment component has improved significantly. Although the current figure still points to a contraction in employment, it is much less pronounced than last month.
Services PMI below 50
The seasonally adjusted PMI for the services sector fell by 3.1 points to 49.8 points in September, falling slightly below the growth threshold again. Almost all sub-components had lost some momentum. However, unadjusted, the index was still above the growth threshold, as an acceleration in the service sector is usually observed in September, according to the report.
The services PMI has fluctuated around the 50-point mark in the last two quarters, which means that the economy in the services sector has deteriorated since the beginning of the year, write the economists at UBS. In industry, on the other hand, stabilization appears to be within reach following the significant improvement in the industrial PMI in the last two months.
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