May was the first time in 11 months that it fell below 50%.
The Israel Purchasing Managers Index compiled by Bank Hapoalim and the Israel Purchasing and Logistics Managers Association fell in May 2010 below 50%, the dividing line between economic expansion and contraction.
The index fell to 48.1% in May from 59.2% in April. This was the first time in 11 months that the index fell below 50%.
Bank Hapoalim said, "Most of the components of the index fell sharply, including domestic demand, export demand, and manufacturing output. The employment component continued to show expansion for the tenth consecutive month, albeit it too showed a significant slowdown."
The weak Israel Purchasing Managers Index provides further support to capital market assessments that the Bank of Israel will keep the interest rate for July unchanged at 1.5% because of the debt crisis in Europe.
Published by Globes [online], Israel business news - www.globes-online.com - on June 21, 2010
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