The Bank Hapoalim and the Israeli Purchasing and Logistics Managers Association’s Purchasing Managers Index (PMI) for July 2013 rose by 1.6 percentage points to a level of 47.6 points.
The index still shows that the economy is contracting, staying below the 50-point dividing line between economic expansion and contraction.
The export demand component indicated expansion in July, after two months of contraction. However, the domestic demand component fell again in July, indicating contraction for the fourth consecutive month.
Bank Hapoalim says that the Purchasing Managers Index has been below the 50-point level for three months, indicating a contraction of industrial activity.
In July, there was improvement in export demand to again indicate expansion, but domestic demand was still struggling to recover, and fell further. The employment component was stable, but still at a level indicating contraction.
Purchasing managers' indices are leading indices that can forecast changes in growth trends; these indices draw extensive global coverage and affect financial markets. Indices include the American ISM index, the European PMI index, and the global index published by JPMorgan Chase Bank.
The index is calculated based on the responses to six questions provided by purchasing managers at leading industrial companies in the Israeli economy. The methodology for computing the index is consistent with the prevalent methodology worldwide for the calculation of purchasing managers' indices.
The Israeli index is included in the calculations of the European and global purchasing managers' indices. The index is published monthly, in the middle of each month, and refers to data collected during the preceding month.
