Swiss Manufacturing PMI Slips to 54.3, Below 56.5 Forecast

Swiss manufacturing activity expanded at a slower pace in June, with the purchasing managers' index coming in at 54.3, below the 56.5 consensus estimate. The headline figure still signals growth. The breakdown showed broad-based weakening.

New orders dropped to 53.5 from 59.4 in May, the steepest monthly decline in the series. Production also eased. Employment conditions worsened, according to the survey. On the positive side, the pace of increase in purchase prices and suppliers' delivery times moderated, though both remain at elevated levels.

The data adds to signs that the Swiss economy is cooling after a strong start to the year. For the Swiss National Bank, the slowdown in demand and easing of price pressures could reduce the urgency for further rate hikes. The SNB next meets in September.

What would confirm the slowdown is a further drop in the PMI below 50 in the coming months, signaling contraction. A rebound in new orders above 58 would weaken the case for a sustained downturn. The next PMI release for July is due on August 1.

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