Purchasing Managers' Index (PMI)
ConceptAbout
The Purchasing Managers' Index (PMI) is a key economic indicator that measures the health of a country's manufacturing and services sectors. It is based on surveys conducted among purchasing managers, who are asked about factors such as new orders, production levels, employment, supplier deliveries, and inventories. The PMI provides timely insights into economic activity, helping policymakers, investors, and economists understand current conditions and anticipate future trends. A PMI reading above 50 indicates sector expansion, while below 50 suggests contraction. It is a leading indicator, offering early signals of economic shifts before they appear in other data like GDP growth. The PMI is widely used globally, allowing for cross-country comparisons and informing decisions in forex trading and economic policy-making. Its monthly release provides regular updates on sector performance, aiding swift decision-making in business and finance.
