PMI™ Data – FAQ

The Purchasing Managers’ Index™ (PMI™) is a survey-based indicator of business conditions, which includes individual measures (‘sub-indices’) of business output, new orders, employment, costs, selling prices, exports, purchasing activity, supplier performance, backlogs of orders and inventories of both inputs and finished goods, where applicable. The surveys ask respondents to report the change in each variable compared to the prior month, noting whether each has risen/improved, fallen/deteriorated or remained unchanged. These objective questions are accompanied by one subjective ‘sentiment’ question asking companies whether they forecast their output to be higher, the same or lower in a year’s time.

Originally compiled for manufacturing, S&P Global pioneered the extension of coverage to other sectors in the 1990s, including services, construction and retail. The PMI and its sub-indices are widely used to anticipate changing economic trends in official data such as GDP, or sometimes as an alternative gauge of economic performance and business conditions to official data, as the latter sometimes suffer from delays in publication, poor availability or data quality issues. Learn more about PMI™ by S&P Global.

The services PMI™ was introduced in 1996 by S&P Global’s economists (known as NTC Research at the time) to accompany the existing manufacturing PMI. With the service sector accounting for a larger proportion of GDP than manufacturing for most developed economies, the services PMI was born out of a need for analysts (and in particular central bank policymakers) to better understand changing business conditions in the wider economy. The services PMI has fewer questions than the manufacturing PMI due to some questions, such as inventories, not being relevant to many service providers. Coverage includes financial services, consumer services and all other business services. All services PMI are published by S&P Global and available to download via subscription.

The ISM Purchasing Managers Index™ is a monthly business survey indicator produced in the United States by the Institute of Supply Management based on questionnaire responses collected from its members, which are predominantly supply chain or purchasing executives in large corporations. The ISM compiles a survey of its manufacturing members and a separate survey of its members in all other areas of the economy, known as its non-manufacturing PMI. You can read more on how the S&P Global PMI has outperformed the ISM survey in providing more accurate indications of actual manufacturing trends in recent years, most likely due to differences in panel structure and questionnaire design.

The Chicago PMI is an economic indicator derived from business survey data collected each month from firms from all sectors specifically in the Chicago area of the United States. Respondents are predominantly members of the Institute for Supply Management – Chicago.

Global PMI™ indices are leading economic indicators compiled by S&P Global and are widely used by economists and financial market analysts due to their ability to provide timely insights into changing worldwide business conditions. Known also as the Global Purchasing Managers’ Index™, the Global PMI™ is derived from responses to monthly questionnaires sent to companies in manufacturing and services sectors in over 40 countries, totaling around 28,000 companies. These countries account for 89% of global gross domestic product (GDP).

Global PMI data for manufacturing and services are calculated by weighting together the country indices using national manufacturing and services GDP weights (annual value added). Global Composite PMI data are then calculated by weighting together comparable global manufacturing and services indices using global manufacturing and services annual value added.

Visit PMI Commentary and Analysis for timely insight into the global economy through PMI analysis.

The vast majority of Purchasing Managers’ Index™ surveys are published by S&P Global (formerly Markit Economics and prior to that NTC Research), which compiles the surveys in over 40 countries. Sometimes these surveys are branded in sponsor’s names, but importantly the data are collected and survey results compiled by S&P Global to ensure the same consistent survey standards are applied globally. Only S&P Global national PMI data are used in updates of broader geographical PMI series such as the global PMI and eurozone PMI.

Other national PMI surveys are released by the ISM (United States), DIFL (Denmark), IVEY (Canada) and SIPP (Singapore) which are not complied by S&P Global and therefore not used in the broader aggregates.

Manufacturing PMI surveys are released on the first working day of each month, followed by services on the third working day. A composite PMI is also published alongside the services PMI, which is a GDP-weighted average of the manufacturing and service sector data. Some countries also have construction PMIs and Whole Economy PMIs, also released towards the start of each month.

The worldwide PMI data are available for download via subscription from S&P Global and press releases are also available from S&P Global. Contact economics@ihsmarkit.com for details.

A manufacturing Purchasing Managers’ Index™ (PMI™) is a survey-based economic indicator designed to provide a timely insight into changing business conditions in the goods-producing sector. However, the definition of ‘Manufacturing PMI’ may describe the survey generically as well as specifically the headline indicator from the survey. The latter is a weighted average of diffusion indices from five survey questions. The weights were originally determined by Theodore Torda of the US Department of Commerce to improve the accuracy of the survey data in anticipating changes in GDP. New orders, which tend to move in advance of other indicators, are given the highest weight (30%), followed by output (25%) and employment (20%), then followed by suppliers’ delivery times (inverted, with a weight of 15%) and finally inventories of goods purchases (10%).

A composite PMI™ is the weighted average of manufacturing and service sector PMIs for a given geography or economy, produced by S&P Global. Weights are derived from official data relating to each sector’s contribution to GDP (value added).

A diffusion index is a convenient system used to convert different survey responses into a single-figure reading. Diffusion indexes are typically used when surveys such as Purchasing Managers’ Index™ (PMI™) surveys ask respondents to report whether a variable, such as their output or employment numbers, has risen, remained unchanged or fallen during the survey period in question.

Diffusion indices are calculated as follows:

INDEX = (Percentage of survey respondents reporting ‘higher’) *1.0 + (Percentage of survey respondents reporting ‘the same’)*0.5 + (Percentage of survey respondents reporting ‘the same’)*0.0

For example, if 100% of survey respondents reported ‘higher’ the index would be 100 (i.e 100 *1.0). If 100% of survey respondents reported ‘the same’ the index would be 50 (i.e. 100 *0.5)

These indexes therefore vary between 0 and 100 with levels of 50.0 signaling no change on the previous month. Readings above 50.0 signal an improvement or increase on the previous month. Readings below 50.0 signal a deterioration or decrease on the previous month. The greater the divergence from 50.0 the greater the rate of change signaled.

Flash PMI™ (Purchasing Managers’ Index™) data are published by S&P Global and are early estimates of the company’s final PMI numbers. The Flash PMI data are published approximately one week before final PMI data each month and are typically based on 85%-90% of total PMI responses received each month.

Flash manufacturing, services and composite indices are published for:

• Australia
• Eurozone
• France
• Germany
• Japan
• United Kingdom
• United States