Bethel Finances: Purchasing Managers Index flat in March

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Bethel Finance news:

The index's employment component fell by a sharp 7.6 points.

Manufacturing continues to contract. The Israel Purchasing Managers Index remained unchanged in March 2011 at 48.5 points. March was the second consecutive month in which the index was below the 50% dividing line between economic expansion and contraction. The index is compiled by Bank Hapoalim and the Israel Purchasing and Logistics Managers Association.

The index's employment component fell by a sharp 7.6 points in March, although both the domestic and export demand components rose. The domestic demand component nevertheless continues to indicate a trend of contraction. Purchases of raw materials and inventory were both below the 50% dividing line in March, signaling expectations of a slowdown in activity.

Prices of raw materials rose for the 16th consecutive month.

The JPMorgan Global PMI (Purchasing Managers Index) fell slightly to 55.8 points in March, although it is still near its all-time high. The index has stayed over the 50% dividing line for 21 months, and most national purchasing managers indexes are at record levels.

Japan's Purchasing Managers Index stood out with a fall of 6.5 points to 46.4 points, as the earthquake and tsunami caused a sharp contraction in economic activity. The US Purchasing Managers Index and the Eurozone Purchasing Managers Index fell slightly to 61.2 points and 57.5 points, but both remained at record levels.

Bank Hapoalim said, "The index indicates a second consecutive month of expectations of a slowdown in manufacturing activity. The drop in the index may reflect expectations of a slowdown in consumption, because of rising prices. The sharp drop in the employment component in March is reasonable in view of the steady growth in the number of employees in preceding months."