A monthly measure of the change in purchases by corporate executives. One hundred and seventy-five managers distributed among different regions and sectors are asked: “Are your purchases higher, the same, or lower than the previous month?” A headline value above 50 indicates an increase in purchases from the previous month and a value below 50 indicates a decrease.
The PMI can be used to measure business optimism and forecast economic growth. Business firms increase purchases and spending in response to growing demand for their goods and services, a high PMI suggests overall expectation for an expanding economy. Furthermore, if businesses are optimistic of future economic conditions they will increase spending now in order to prepare for future demand in their goods and services.
Note : The Institute of Supply Management publishes a similar index known as the “Reports on Business” for the United States . Unlike the Canadian PMI, the Reports on Businesses uses mid-month data, adjusts for seasonality, and asks a combination of five questions. As a result, the Canadian PMI tends to have larger month to month movements than the U.S. version
Relevance : Tends to move markets on release
Release Schedule : 10:00 AM (EST); monthly, on the fourth working day of the following month
Source of Report : Joint Sponsorship between the Purchasing Management Association of Canada and the Richard Ivey School of Business
Web Address : http://iveypmi.uwo.ca/english/welcomeeng.htm
Address of Release : http://iveypmi.uwo.ca/english/historic_data.htm
AKA: Canadian Purchasing Managers Index