PMI Data Guide: ISM, S&P Global & Manufacturing Surveys
Understanding Purchasing Managers\
What Is PMI?
The Purchasing Managers' Index (PMI) is a survey-based indicator measuring business conditions. It's a leading indicator—PMI data often predicts economic turning points before GDP data confirms them.
How PMI Works
The Survey
Purchasing managers answer questions about:
- New orders
- Production
- Employment
- Supplier deliveries
- Inventories
The Index
- Above 50: Expansion
- Below 50: Contraction
- 50.0: No change
Rule of thumb: PMI above 42.5 generally indicates GDP growth.
Key PMI Sources
ISM Manufacturing PMI
IQ Score: 96 | Monthly | 1948-present
The original and most-watched US PMI.
Series: NAPM (Purchasing Managers Index)
Components:
- New Orders (30% weight)
- Production (25%)
- Employment (20%)
- Supplier Deliveries (15%)
- Inventories (10%)
ISM Services PMI
IQ Score: 95 | Monthly | 1997-present
Non-manufacturing sector survey.
Series: NMFCI (ISM Non-Manufacturing Index)
Important: Services is ~80% of US economy, so this matters more than manufacturing for GDP.
S&P Global PMI (formerly IHS Markit)
IQ Score: 93 | Monthly
Private survey with global coverage.
Key Features:
- Flash estimates (preliminary, released earlier)
- More granular country coverage
- Manufacturing and Services for 40+ countries
Regional Fed Surveys
Fed district banks conduct their own manufacturing surveys:
| Survey | FRED Code | Region |
|---|---|---|
| Empire State | NYMS | NY Metro |
| Philly Fed | PHMIDX | Mid-Atlantic |
| Dallas Fed | DFFXL | Texas |
| Richmond Fed | RFMIGDP | Southeast |
| Kansas City | KCFSI | Central US |
| Chicago PMI | CHICAGOFED | Midwest |
Why They Matter:
- Released before ISM
- Regional economic health
- Can preview national trends
Global PMI Data
Eurozone
- Manufacturing: PMI released by S&P Global
- Services: Also S&P Global
- Composite: Manufacturing + Services combined
China
- Caixin PMI: Private sector focus (S&P Global)
- NBS PMI: Official government PMI
- Often diverge—Caixin covers more small/private firms
Japan
- Jibun Bank PMI: S&P Global Japan PMI
- Tankan Survey: BOJ's quarterly business survey (different methodology)
Interpreting PMI
Strong Signal
- PMI > 55: Robust expansion
- Rising trend over 3+ months
- New Orders > Production (building momentum)
Warning Signs
- PMI 50-52: Weak expansion
- PMI declining from high levels
- New Orders < Production (slowing momentum)
Recession Signal
- PMI < 50 for 3+ months
- ISM Manufacturing < 45
- Services PMI joining manufacturing in contraction
PMI vs. Hard Data
| PMI | Hard Data Equivalent |
|---|---|
| Production | Industrial Production |
| Employment | Nonfarm Payrolls |
| New Orders | Factory Orders |
| Prices | PPI |
PMI leads hard data by 1-3 months but can give false signals. Use both.
Pro Tips
- Watch new orders: Most forward-looking component
- Services > Manufacturing: Better GDP predictor
- Regional surveys first: Preview national ISM
- Mind the noise: Single month moves can be misleading
- Check comments: ISM qualitative commentary often insightful
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