Difficult start to 2024: Mood in Swiss industry still weak

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Industrial PMI rose 0.9 points to 44.0 points in February but remained below the growth threshold for the fourteenth consecutive year, UBS announced on Friday. It calculates the index together with Procure.ch, the Swiss purchasing and supply management association.

Economists surveyed by the AWP news agency roughly expected this, or predicted that the index would fall in the range of 42.5 to 45.1 points.

The low point of the current cycle was 38.5 points in July 2023, at which time it had fallen to its lowest level since 2009. It has been said that it has been in the contraction zone for longer than it was during the great financial crisis. For PMI, values ​​of 50 points and above indicate growth, while values ​​below 50 points indicate a decline in the economy.

While the industrial PMI was somewhat supported by a less pessimistic assessment of the production situation, the serious decline in the employment component was even more humiliating, according to experts. The fact that 17 percent of companies reported that some of their workforce was working on short-term jobs in February also fits the now more cautious picture.

Delivery times have eased slightly after a sharp increase in January due to the Houthi rebels’ threat to shipping in the Red Sea. But it’s too early to clarify everything.

Meanwhile, there was a small decline in the services PMI. However, after 54.6 points, it remains above the growth threshold with 53.0 points. This points to further growth for the sector, but momentum is slowing, according to UBS economists.

Overall, the PMI index continued to show a divided economy in February, albeit in a weaker form. While the drought continues in the industry, the service sector continues to grow. (SDA)

Source :Blick