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Analysis

Flash PMIs

by Gabriel Stein

Mon 23 Jun 2014

Flash PMIs Enlarge Chart loading Image

What the chart shows: The chart shows purchasing managers indices in a number of countries

Why the chart is important: PMIs – purchasing managers’ indices – are an early indicator of output in business, usually divided into manufacturing, services and a composite index. An index number above 50 conventionally describes and expansion; a number below 50 is a contraction. PMIs for June, released on 23rd June, paint a picture of two economies. In east Asia, the Chinese manufacturing PMI hit an eight-month high, rising above 50 for the first time this year. In Japan, the PMI moved back above 50 after two months below, although it remains below levels seen earlier in the year. But the direction of East Asian PMIs is up. By contrast, in the euro area, the pan-EA, German and French manufacturing PMIs are all trending down. They also performed worse than expected in June.  This raises a question mark over the strength of the ongoing Eurozone recovery and should be a cause for concern for policymakers.

Chart and comments provided by Oxford Economics www.oxfordeconomics.com