The purchasing managers index compiled by

Dun & Bradstreet

and the association of purchasing managers in Israel showed that domestic demand and exports plunged in April, after two months of climbing.

After factoring in seasonal fluctuation, the April index of Israeli purchasing managers stood at 45.4% against 51.2% in March.

Excluding export, the April index for April came to 45.3%, compared with 53.1% for March.

D&B economists say that the optimism evinced in the last two months was evidently premature.

All the components incorporated in the April index were markedly lower than in the preceding two months. The analysts recommend waiting for May data before ruling whether the slowdown is continuing or if the April decline was the one-off event.

All the index components declined below 50% in April. The sharpest drops include a 8.3% drop in export, a 7.8% decrease in demand in the local market, and a 9.4% drop in the volumes of acquisitions for inventory.

The export component in April came to 41.5%, substantially below the 49.8% posted in March.

The D&B economists point out that the trend itself has changed. It points to continued decline in the coming period, they say.

The manufacturing production fell below the 50% mark that separates slowdown and expansion. It came to 49.0%, compared with 54.7% in March.

The component of acquisitions for inventory points to real pessimism. This component fell to 38.6%, compared with 42.0% in March. The analysts say the blatant pessimism of purchasing managers in this component has harsh implications for the economy at large.

The component of purchasing prices oddly climbed in March, say the analysts. But it dived in April to 48.2%, compared with 59.6% in March.

The component of raw-materials production dropped to 37.2%, compared with 47.3% in March, and following the moderate increase recorded in the preceding two months. D&B believes that that this is a clear indicator that purchasing managers are pessimistic about the economy in the coming period, and that the general trend points to continued decline in stocks in the coming period.

The employment component fell in April to 46%, compared with 52.2% in March. The D&B economists write that an analysis of the data points to a rise in employment in the coming period.