Hungary's PMI drops to 52.2 in July

Analysis

Hungary's seasonally adjusted Purchasing Managers Index (PMI) fell to 52.2 in July after rising to 54.4 in June, the Hungarian Association of Logistics, Purchasing and Inventory (HALPIM) announced on Monday.

The adjusted July PMI was the lowest since September 2010 and fell below the the 52.3 points registered in May which was the lowest value so far this year.

Hungary's PMI has reflected a slowdown of growth in the manufacturing sector in the past few months after a rapid increase between last November and April this year, the report noted.

A PMI of over 50 indicates expansion in the manufacturing sector compared to the preceding month, while a PMI of under 50 indicates contraction in the sector.

Three of the PMI's five sub-indices were above 50 last month, but all three indicated slower growth : the production-volume, the new-orders and the employment sub-indices. The first two indices were above 50 for the 19th-consecutive month, and the employment sub-index indicated rising employment in the sector now for the tenth time in a row.

The rise of the purchased-stocks sub-index in the previous two months halted in July, and the index was below the average of the previous 14 years.

The delivery-time sub-index declined, indicating a further lengthening of delivery times. The sub-index has been below 50 for an unprecedented 20 months in July.

The HALPIM PMI index and sub-indices are based on monthly surveys of 100 supply managers at manufacturing companies in Hungary.

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