Iran’s PMI declines for a second consecutive month

Iran Chamber of Commerce has released the country’s new PMI data for the fiscal month of Mordad (July 22 – August 22) which has continued to decrease for a second month in a row.

According to the new PMI reading, Iran’s monthly PMI stood at 49.97. The figure has dipped to below the threshold (below 50), 0.66 points lower than the earlier month when the figure was reported at 50.63.

The survey suggests that the supply of raw materials and the growing increase of raw material prices are two main problems affecting the Iranian production sector.

Continuation of the current conditions can even give a more rise to the already growing Producer Price Index (PPI).  

The Statistics and Economic Analysis Center of Iran Chamber of Commerce, Industries, Mines and Agriculture, the sponsor and coordinator of the survey, announces the whole economy PMI data in a report every month.

The headline PMI is a number from 0 to 100, such that over 50 shows an expansion of the economy when compared with the previous month. A PMI reading under 50 indicates contraction and a reading of 50 implies no change.

PMI is an index of the prevailing direction of economic trends, aiming to provide information about business conditions to company directors, analysts and purchasing managers.

The “new orders” sub-index, has declined to 44.84 in the month under review to register its lowest in the past seven months excluding the calendar month of Farvadin in which the economic indicators tend to fall due to two-week Persian New Year holidays.

The “raw material inventory” sub-index (47.88) has also been reducing for a third consecutive month.

The “finished good inventory” sub-index (51.01) has increased compared to 48.83 reported in the preceding month.

The “sales of goods and services” sub-index (49.13), is still below the threshold although it has improved from 44.73 of the preceding month.