Purchasing Managers’ Index – Services, June 2014
Services PMI drops to 54.6 in June: stable growth in the service sector.
- The purchasing managers’ index for the service sector (Services PMI) fell to 54.6 in June, marking the twelfth consecutive month in the growth zone. Even though all component indices except for supplier delivery times decreased, this month’s index levels indicate strong demand, large order backlogs, and an optimistic outlook for the next six months.
- The index for business activity dropped to 57.0 in June, but a three month moving average shows stable growth since the end of 2013. Planned business activity remains above 60 and production and new orders are also in the growth zone, all of which contribute to rising employment.
- Only the index for supplier delivery times made a positive contribution to the Services PMI, adding 0.1 points. An overwhelming majority of purchasing managers reported rising or unchanged delivery times, which indicates a stable or gradually improving scenario for suppliers.
- The index for suppliers’ intermediate goods prices rose for the first time during the year from 49.3 in May to 53.4 in June. This index ends the second quarter at the highest level we’ve seen this year, but the quarterly average for Q2 is lower than for Q1. It will be interesting to follow prices in the coming months to see whether the increase in June is temporary or if the downward trend for suppliers’ intermediate goods prices has bottomed out.
PMI - Services, June