- Prior 51.0
- Manufacturing PMI vs 54.8 expected
- Prior 55.3
- Composite PMI vs 51.7 prior
For background, the S&P Global US PMIs are monthly surveys of senior purchasing and operating executives at private-sector companies, run separately for manufacturing and services and combined into a headline composite. They are produced by S&P Global Market Intelligence, the operation that absorbed IHS Markit, and are modeled on the same diffusion-index methodology used across its global PMI franchise covering more than 40 economies.
The “flash” releases are preliminary estimates published roughly a week before month-end, based on about 75% to 85% of the total monthly survey responses. Final readings follow at the start of the next month once the remaining replies are collected. The flash is among the earliest cyclical reads on a given month, which is the main reason markets watch it.
Each index is built from panel responses comparing current conditions to the prior month, scored on a 0-to-100 scale where 50 marks the line between expansion and contraction. The manufacturing PMI is a weighted composite of five subindices: new orders, output, employment, suppliers’ delivery times, and stocks of purchases. The services PMI headline is the business activity index. Both surveys also publish detail on new orders, employment, input and output prices, backlogs of work, and twelve-month output expectations.
The manufacturing panel covers around 800 companies; the services panel is larger. Responses are weighted by company size and sector contribution to GDP. The composite output index blends manufacturing output and services activity, weighted by each sector’s share of value added.
In the US specifically, the S&P Global manufacturing gauge competes for attention with the older, more widely cited ISM manufacturing index, and the two can diverge meaningfully because of differences in panel composition, sector weighting, and seasonal adjustment. The services figures likewise sit alongside the ISM services report. Data are seasonally adjusted, and a sister price index feeds inflation watchers.
This article was written by Adam Button at investinglive.com.
