May PMIs: Services and Composites

European purchasing managers in the service industries continue to report lower activity. In May the PMIs for the service industries in Spain, Italy and France were respectively 41.84, 42,78 and 45.09, compared with 42.11, 42.32 and 45.21 in April. Even German purchasing managers who are still technically in an expansion phase (that is, the index is above 50) experienced a decline in their index from 52.21 in April to 51.76 in May. In the East, purchasing managers in the service industries in China, India and Russia reported increases in their PMIs to 54.72, 54.69 and 54.52, respectively in May, from 54.06, 52.76 and 54.03 in April. Purchasing managers in Japan, however, reported a decline in activity. The index fell from 50.98 in April to 49.79 in May and thus into a contractionary phase. The PMIs for the service industries for Germany, Spain, Italy and France are shown in the first chart and those for China, India, Russia and Japan in the second chart.

With the release of the Service PMIs, the Composite PMIs, which are the sum of the Manufacturing PMIs and the Service PMIs become available (The manufacturing PMIs were released last week). The Composite PMIs for Germany, Spain, Italy and France are all indicating contraction. Germany is just below the 50 mark at 49.27, but France at 45.35, Italy at 43.49 and Spain at 41.21 are indicating more serious contractions. The Composites for India increased from 53.13 in April to 53.66 in May and for Russia from 53.37 to 54.54. The composites for both China and Japan fell in May. Japan fell from 50.72 in April to 50.25 in May while Japan fell from 51.25 in April to 50.09 in May. The Composite PMIs for Germany, Spain, Italy and France are shown in the third chart and those for China, India, Russia and Japan in the fourth chart.

Purchasing Managers Index May 2012 Apr 2012 Services Germany 51.76 52.21 Spain 41.84 42.11 Italy 42.78 42.32 France 45.09 45.21 China 54.72 52.06 India 54.69 52.76 Russia 54.52 54.03 Japan 49.79 50.98 Composite Germany 49.27 50.51 Spain 41.21 42.00 Italy 43.49 42.65 France 45.35 46.09 China 50.25 50.73 India 53.66 53.13 Russia 54.54 53.37 Japan 50.09 51.25