SWEDEN: May PMIs Post Solid Performance, But Riksbank Interests Elsewhere
The solid performance of the Swedish May PMIs contrasts somewhat with the May Economic Tendency Indicator, which eased to 94.6 from 95.0 in April. However, the composite PMI has generally been more optimistic than then ETI since the pandemic. For the Riksbank, more focus will be on tomorrow’s flash CPIF report and the central bank’s own Business Survey on June 10.
- The Swedish services PMI moved back into expansionary territory in May, rising to 50.8 from 48.7 prior, above the 4-analyst strong 48.9 consensus. The composite PMI was thus 50.3, unchanged on the month.
- In May, services production rose to 46.9 (vs 46.5 prior), while new orders rose to 51.5 (vs 48.1 prior), the highest since October 2024.
- In a positive development for the inflation outlook, supplier input prices fell to 51.4 (vs 55.5 prior), the lowest since September 2024.
- Employment climbed to 47.7 (vs 45.4 prior), while order backlogs eased.
- Expected production was little changed at 58.6 (vs 58.5 prior).
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EQUITY TECHS: E-MINI S&P: (M5) Clears The 50-Day EMA
- RES 4: 5865.42 200-dma
- RES 3: 5837.25 High Mar 25 and a bull trigger
- RES 2: 5773.25 High Apr 2
- RES 1: 5724.75 High May 2
- PRICE: 5674.25 @ 07:24 BST May 3
- SUP 1: 5511.99 20-day EMA
- SUP 2: 5355.25/5127.25 Low Apr 24 / 21 and a key support
- SUP 3: 4996.43 76.4% retracement of the Apr 7 - 10 bounce
- SUP 4: 4832.00 Low Apr 7 and the bear trigger
The latest recovery in the e-mini S&P reinforces current bullish conditions.The contract has traded through the 50-day EMA, at 5620.87. A continuation of the bull phase would expose 5837.25 next, the Mar 25 high and a bull trigger. It is still possible that the entire rally since Apr 7 is a correction. A reversal lower would signal the end of this corrective phase and expose initially, support at 5127.25, the Apr 21 low.
MNI: SWISS APR CPI +0% M/M, +0% Y/Y
- MNI: SWISS APR CPI +0% M/M, +0% Y/Y
EUROPEAN INFLATION: Swiss April CPI Below Consensus
Swiss CPI inflation printed below consensus at 0.0% in April (vs 0.2% cons; 0.3% prior), and 0.0% M/M. Core CPI also printed below consensus, at 0.6% Y/Y (vs 0.8% cons; 0.9% prior).
- This means inflation started off Q1 well below the 0.3% Y/Y SNB expectation for this quarter. Note that Chairman Schlegel has mentioned in the last press conference that negative inflation would not be totally outside of expectations if it only persists for single months (as opposed to quarters, the SNB's reference period for their official forecasts).
- The main categories appear to indicate that the headline drop vs March was relatively broad-based on first sight:
- Domestic 0.8% vs 1.0% prior
- Imported -2.5% vs -1.7% prior
- Services 1.4% vs 1.6% prior
- Goods -2.0% vs -1.6% prior
- Energy and fuels -7.8% vs -7.1% prior
- Housing rental inflation did not see its quarterly price update this month (due May).
