Switzerland: Manufacturing sector contracts at sharper pace in June; expansion in services sector slows
The manufacturing Purchasing Managers’ Index (PMI) produced by Credit Suisse and procure.ch edged down to 47.7 in June from 48.6 in May, falling to the lowest level since October 2012. Consequently, the index remained below the 50-point threshold that separates expansion from contraction in the manufacturing sector.
The fourth consecutive decline in industrial activity came on the back of falling production and a sharp drop in new order books, which fell to their lowest level in nearly seven years. Given notably weaker demand, firms scaled backed purchasing activity leading to shorter supplier delivery times. Stocks of raw materials dwindled slightly, whereas inventories of semi-finished and finished goods rose marginally. On a brighter note, job creation picked up in June.
The services sector also saw drearier results with the PMI falling starkly from 58.2 in May to 52.2 in June. The sector remained in expansionary territory nonetheless. The services sector saw weakness across the board as commercial activity slowed notably while new business inflows also waned. Meanwhile, weaker demand prompted businesses to cut staff levels and reduce order books in the month.