For the first time since the beginning of the year, the Purchasing Managers’ Index conducted by Bank Hapoalim fell below the 50-point level, which is significant. We will explain that the Purchasing Managers’ Index is a reading of an index and it has been falling for several months, but as long as this index is above 50 points, it indicates even slow and cheap growth, but when this index falls below the 50-point level, it indicates an economic slowdown.
If so, the Purchasing Managers’ Index of Bank Hapoalim and the Purchasing Managers’ Organization decreased in April by 2.6 points to a level of 48.9 points. The index, which had been on a downward trend in recent months, moved to indicate a contraction in activity for the first time in five months. The components of employment and export orders continue for the third month to indicate a contraction, while the components of domestic orders and production output decreased this month but continue to indicate expansion.
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The Global Purchasing Managers’ Index is edited and published by JPMorgan and it remained unchanged this month at a level of 49.6 points. The index has been below the level of 50 points for eight months. In the USA, the ISM index rose to the level of 47.1 points from 46.3 points. The Purchasing Managers’ Index in the Eurozone fell to the level of 45.8 points from 47.3 points and continues to indicate a contraction. The Purchasing Managers’ Index in China (Caixin) fell to the level of 49.5 points from 50.0 points in the previous month.
Bank Hapoalim reported that “Like the rest of the world, the index in Israel fell below the level of 50 points. The level is still close to 50, which means that the index now signals a stabilization in industrial activity. The ongoing contraction in the component of export orders reflects the slowdown in the global economy, especially in Europe, which is the largest trading partner of the local industry. The contraction trend in the index also corresponds to the growth data for the first quarter of 2023 which indicated that growth in the first quarter of the year slowed to an annual rate of 2.5% and mainly a decrease of an annual rate of 10.9% in the export of goods.”
