Swiss purchasing managers’ indices develop in opposite directions
Published: Friday, Nov 1st 2024, 10:50
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The managers of Swiss industrial companies responsible for purchasing remain unchanged in their assessment in October. This contrasts with the mood in the service sector, which has brightened further.
The Purchasing Managers' Index (PMI) for industry remained at 49.9 points in October (seasonally adjusted). It thus remains just below the growth threshold: PMI values above 50 points indicate growth and values below that indicate a decline.
However, the index had reached its highest level since December 2022 with a slight increase in the previous month. That was the last time it was above the growth threshold, at 54.1 points.
However, with the development in October, the long-lasting downward trend in the industry has at least temporarily come to an end, UBS announced on Friday. The major bank publishes the index together with the purchasing and supply management association Procure.
According to UBS, the production and order backlog components even point to a slight expansion. Production has even risen to its highest level in two years and has now been above the growth threshold for three months.
However, delivery times and inventories in purchasing prevented an increase in the industrial PMI, as both components were slightly lower in October than in September.
The interpretation of delivery times is currently difficult - the difficulties could come from increased demand but also from supply chain disruptions. The situation in the industry could therefore be slightly better than indicated by the PMI, the experts explain.
Services PMI back above 50
The seasonally adjusted PMI for the services sector rose by 2 points to 51.8 points in October, climbing slightly above the growth threshold again. While the business activity component fell slightly, the decline was offset by an increase in the new orders, order backlog and, in particular, employment components.
With a value of 49.1 after 44.6 in the previous month, the employment component continues to point to lower employment, but the risk of a
However, the recovery of the component in October has averted a massive reduction for the time being.
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