The unadjusted Ivey PMI gave back around half of May's jump with a 3.7 point drop to 54.7 in June. However, after a boosting the index in mid-quarter, seasonal factors tend to have a negative impact in June and the seasonally adjusted PMI actually rose 2.3 points to 51.7 and so back into positive growth territory.
Within the adjusted results the employment sub-index (52.5) also pointed to renewed gains, registering its strongest outturn since January. This should bode well for Friday's Labour Force Survey. Elsewhere, delivery times (47.3) slowed but business inventories (55.1) expanded at their fastest rate in five months. Lastly, prices (59.7) rose again but less quickly than in May (63.1).
The average adjusted PMI for the quarter just ended was 51.4, well short of the 56.5 posted in the first three months of the year (although that was strongly biased up by January). This is consistent with a widely expected sharp deceleration in second quarter growth but, on paper at least, suggests that talk of a possible outright contraction in real GDP may be too pessimistic.
The Ivey Purchasing Managers Index measures month to month changes in dollars of purchases as indicated by a panel of purchasing managers from across Canada. The 175 participants in this survey have been carefully selected geographically and by sector of activity to match the Canadian economy as a whole. The index includes both the public and private sectors. Index panel members indicate whether their organizations activity is higher than the same as or lower than the previous month across the following five categories - purchases, employment, inventories, supplier deliveries and prices. The Ivey Purchasing Managers Index is sponsored by the Richard Ivey School of Business and the Purchasing Management Association of Canada.
The Ivey PMI is provided in two formats -- unadjusted and seasonally adjusted. The index shows responses to one question: "Were your purchases last month in dollars higher, the same, or lower than the previous month?" A figure above 50 shows an increase while below 50 shows a decrease.<br/><br/>The index measures the month to month variation in economic activity as indicated by a panel of purchasing managers. The index uses end of the month data and it covers all sections of Canada's economy. The PMI includes both the public and private sectors and is based on month end data Ivey PMI panel members indicate whether their organizations activity is higher than, the same as, or lower than the previous month across the following five categories: purchases, employment, inventories, supplier deliveries and prices. <br/>