Israel: Manufacturing PMI recovers markedly in July
August 19, 2020
The Purchasing Managers’ Index (PMI), produced by Bank Hapoalim and the Israeli Purchasing & Logistics Managers Association (IPLMA), increased from 45.0 in June to 49.8 in July, but remained slightly below the neutral 50-mark signaling worsening operating conditions. July’s increase was driven by softer declines in new domestic and export orders, and faster output growth.
According to Bank Hapoalim economists: “Global industrial activity continues to improve and this is reflected in PMIs around the world. At the same time the recovery is in relation to the low level of production that characterized recent months, and the level of production itself is usually lower than before the pandemic. The manufacturing sector is much less affected relative to other industries. The recovery in the service sector is much more moderate.”
Manufacturing activity should gradually recover going forward, although tepid external demand and the risk of further lockdowns at home will likely keep a lid on momentum.
Author: Oliver Reynolds, Economist