BA-CA Purchasing Managers’ Index in August:
Industry moves into autumn with full order books
- Despite a slowdown in momentum, industry continues to report strong growth
- For the last six months domestic demand stronger than foreign demand
The BA-CA Purchasing Managers’ Index once again dipped slightly in August to 56.3 compared to July (57.1), reaching the lowest level since February. Nevertheless, a reading of 56.3 still indicates very brisk industrial production. Index readings above 50 indicate growth. "We should not be fooled by the decline in the BA-CA PMI over the last two months. Austrian industry is continuing to grow at a rate of over 8%", said Marianne Kager, chief economist at Bank Austria Creditanstalt (BA-CA). "Even if momentum is now weakening, the pace of industrial production remains extremely brisk."
Notwithstanding the decline from 57.6 to the present figure of 57.1, the industrial companies surveyed reported another sharp rise in the level of incoming orders. According to Stefan Bruckbauer from BA-CA: "The volume of both domestic and foreign orders has continued to rise sharply, although over the last six months domestic demand has been stronger."
In keeping with this healthy order situation, inventories of finished goods were run down again in August. At the same time, employment levels are rising in industry, although at a slightly slower pace – with the relevant indicator dropping from 54.7 in the previous month to 53.8. "In August we saw the second highest figure for employment growth in industry since 2000," is Kager's comment on this positive trend.
In keeping with the burgeoning economy, prices and delivery times are only easing slightly. With a reading of 68.1, the indicator shows that managers are continuing to report steep price increases (71.3 in July).
Overall, the mood of Austrian industry remains buoyant as summer draws to a close. "The BA-CA Purchasing Managers’ Index does not indicate any serious slow down in the pace of industrial growth in the short term," Bruckbauer concluded.
Note: PMI figures above the 50.0 mark indicate growth; readings below the 50.0 mark indicate contraction in the manufacturing sector compared to the previous month. The greater the divergence from 50.0, the greater the change signalled. This report contains the original data from the monthly survey among purchasing managers of industrial companies in Austria. The survey is sponsored by Bank Austria Creditanstalt and has been carried out by NTC Research under the auspices of ÖPWZ, the Austrian Productivity and Efficiency Centre, since October 1998.
Enquiries: Bank Austria Creditanstalt Economics Department
Stefan Bruckbauer, Tel. +43 (0)5 05 05 EXT. 41951