Purchasing Managers Index falls to 2-year low

The Israel Purchasing Managers Index fell 6.4 points in January 2012 to 36.3 points.

The Israel Purchasing Managers Index, compiled by Bank Hapoalim and the Israel Purchasing and Logistics Managers Association, fell 6.4 points in January 2012 to 36.3 points, due to falling export demand. The index has fallen to its lowest level since March 2009; it is well below the 50-point dividing line between economic expansion and contraction.

The index's manufacturing output component fell 12.2 points in January to 35.5 points and the domestic demand component fell 8.7 points to 31.8 points. Although the inventory and prices components rose in January, they are both still below the 50-point dividing line.

Bank Hapoalim says, "The low level the index has reached reflects an even more worrying situation that the numbers indicate. We attribute this to the blow to industry, which accounts for 20% of business product, was worse than for the other components of the index."

Bank Hapoalim says that the economic slowdown in recent months is the reason for the worrying figures. Purchasing managers are worried about repercussions from the debt crisis in Europe on the Israeli economy in the near term.

The JPMorgan Global Purchasing Managers Index rose in January to 51.2 points. The US Purchasing Managers Index rose to 54.1 points, and has not been below the 50-point dividing line since mid-2009. Although the indices for most European countries rose in January, most of them continue to show economic contraction.

Published by Globes [online], Israel business news - www.globes-online.com - on February 15, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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