Swedish Machinery

Transportation and Steel

Today’s release of the Swedish Purchasing Managers Report for August shows a really significant drop in one of the components. The New Orders element dropped from 51.2 in July to 41.1 in August. Why is this significant? Well, the economy in Sweden is very focused. Machinery,Transport and Equipment make up 44% of Exports and 40% of Imports. As transportation is a leading barometer of economic activity it is important to watch this sector closely when the global economy is so finely balanced. I have blogged several times about my concerns for Volvo and this most recent data, whilst not suggesting transportation was to blame for the decline, can only reflect badly on the sector due to its high proportion of GDP.

Interestingly, mining machinery manufacturers globally, have warned of slowing sales in the past two weeks. I have been talking of my concerns in this sector many times. Sweden is a leading player in this field Atlas Copco, Sandvik etc. What must not be forgotten of course is that this is the most Steel hungry industry group. Regular readers will know my major concerns in this field. See regular blogs on Iron Ore , Steel and BRICs and Lucky Jim Oneill

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Monday, September 3rd, 2012 BRICs, Euro, Steel

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