Economy Swiss purchasing managers' indices clearly improved in August
The managers responsible for purchasing at Swiss companies became significantly more optimistic in August. However, industrial companies are still struggling to reach the growth threshold.
02.09.2024, 09:41
SDA
The Purchasing Managers' Index (PMI) for industry rose by 5.5 points to 49.0 points in August (seasonally adjusted). Nevertheless, it remains below the growth threshold of 50 points for the 20th month in a row. For the PMI, values above 50 points indicate growth and values below indicate a decline.
With the increase in August, the PMI reached its highest level since January 2023. The last time it was above 50 points was in December 2022. The latest improvement was due to a stronger production component and higher purchasing volumes, UBS reported on Monday. The major bank publishes the index together with the purchasing and supply management association Procure.
The corresponding sub-components rose by 9.7 and 10.4 points respectively in August and, at 52.8 and 50.1 points, are just above the growth threshold at their highest level so far this year. Purchase prices rose again slightly to 51.7 points. And the "order backlog" sub-component showed less negative momentum, rising by 8.4 points to 48.9 points.
However, interpreting the data is not easy. The PMI data did show a slight improvement in momentum in the Swiss industrial sector, writes UBS. However, this comes as more of a surprise as the industrial economy in the eurozone is weak and the Swiss franc tended to appreciate in August, which is weighing on exports in the local industry.
Services PMI back above 50
The PMI for the services sector climbed to 52.9 points in August, making up for the sector's weak phase in July (44.7 points). Nevertheless, the interpretation of the services PMI should be treated with caution due to the volatility of the index in recent months, says UBS. After all, the August value is above the 3-month average of 49.8 points.
According to the data, the moderate growth in the service sector is reflected in numerous sub-components. Almost all components used to calculate the index increased compared to the previous month. The sub-components "new orders" with 53.7 points and "business activity" with 57.3 points rose significantly and were thus clearly above the threshold value of 50 points. The "business activity" sub-component also reached its highest value since January 2024.
