In June 2021, the seasonally and calendar adjusted SAMEKS Composite Index declined by 0.9 points compared to the previous month, falling to 50.3.

This decline was driven by the services sector index losing 0.7 points of momentum compared to the previous month and falling to 50.4, while the industry sector index rose by 0.5 points compared to the previous month to 50.1.

In this period, business volume across the services sector is observed to have maintained its stagnant outlook. The industry sector, on the other hand, has entered an upward trend once again following the decline in May, together with the strong increase in input purchases.

As a result of these developments, the seasonally and calendar adjusted SAMEKS Composite Index, which fell by 0.9 points compared to the previous month to 50.3, maintained its course above the reference value and presented a positive outlook; nevertheless, the loss of momentum in the index's rate of increase continued in June as well.

Industry Sector SAMEKS Index

The seasonally and calendar adjusted Industry Sector SAMEKS Index rose by 0.5 points in June 2021 compared to the previous month, climbing to 50.1.

The rise in input purchases by 8.9 points at once compared to the previous month, reaching 63.1, was the decisive factor in the industry sector once again standing above the reference value of 50.

Despite the increase in purchases, the decline in new orders continued in this period, and the sub-index in question fell by 3.1 points compared to the previous month to 45.5.

In parallel with the weak outlook in new orders, production across the industry sector remained stagnant and the production sub-index stood at 43.8, despite an increase of 4.1 points compared to the previous month.

The stocks sub-index, which stood at 47.3 despite rising by 1.0 point compared to the previous month, indicates that firms tended to run down their existing stocks in June. The suppliers' delivery time sub-index, which stood at 57.8 in the same period, confirms that firms experienced no problems in the supply of goods and services.

The employment sub-index, which maintained its course above the reference value at 50.3 points in this period as well, showed that the increase in labour demand across the industry sector continued; however, the decline of 9.7 points observed compared to the previous month indicates that the pace of employment growth fell in June.

As a result of these developments, the Industry Sector SAMEKS Index, which rose by 0.5 points compared to the previous month and once again stood above the threshold value, signalled that the sector regained momentum following its decline in the May period.

Services Sector SAMEKS Index

The seasonally and calendar adjusted SAMEKS Services Sector Index declined by 0.7 points in June 2021 compared to the previous month, falling to 50.4.

Despite falling by 1.5 points compared to the previous month, the positive outlook in input purchases continued in this period as well and the sub-index in question stood at 62.2.

The business volume sub-index, which stood at 44.3 with an increase of 0.1 points, indicates that the stagnant outlook across the services sector persisted.

The decline in finished goods stock that began in the May period accelerated in this period, and the stocks sub-index, falling by 6.9, dropped to 39.6. The suppliers' delivery time sub-index, which fell by 5.1 points compared to the previous month to 49.3, indicates that disruptions were observed in firms' supply of goods and services in this period.

The employment sub-index, meanwhile, stood at 50.3 despite falling by 0.8 points and maintained its course above the reference value of 50 in June as well.

Thus the Services Sector SAMEKS Index, standing at 50.4, maintained its positive outlook in this period as well; nevertheless, the pace of recovery across the sector was observed to be low.

COMMENTARY:

The loss of momentum observed in economic activity with the 17-day “full lockdown” process in May was also reflected across the services sector in June, while a relatively faster recovery was recorded in the industry sector. While economic activity is expected to recover rapidly as of July, when the restriction measures will be fully eased, the official holidays that will arise in that calendar because of the 15 July Democracy and National Unity Day and the Feast of Sacrifice will keep the revival in economic activity under pressure on the industry sector side. At the same time, the fact that the holiday and tourism season will open in this period will accelerate activity across the services sector.