| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Index | 50.7 | 49.5 to 50.8 | 48.3 | 50.4 |
Highlights
The S&P Global China manufacturing PMI showed a sharp deterioration in conditions in the sector in May, with the headline index falling to 48.3 from 50.4 in April. This is the first time this survey has shown contraction in the sector since September 2024 and the index is now at its lowest level since September 2022. Official PMI survey published on the weekend also showed contraction in the sector in May.
Respondents to the S&P PMI survey reported output, new orders, and new export orders all fell in May and all fell at the sharpest pace in well over a year. Respondents cited the impact of the increase in global trade tensions as a significant factor weighing on external demand. Payrolls were also reported to have been cut in May but the survey's measure of business confidence shows that respondents expect output to rise from current levels over the next twelve months. The survey also shows input costs fell for the third month in a row and at a sharper pace and that firms cut selling prices for the sixth consecutive month.
Respondents to the S&P PMI survey reported output, new orders, and new export orders all fell in May and all fell at the sharpest pace in well over a year. Respondents cited the impact of the increase in global trade tensions as a significant factor weighing on external demand. Payrolls were also reported to have been cut in May but the survey's measure of business confidence shows that respondents expect output to rise from current levels over the next twelve months. The survey also shows input costs fell for the third month in a row and at a sharper pace and that firms cut selling prices for the sixth consecutive month.
Market Consensus Before Announcement
Index expected to remain barely in expansion at 50.7 in May versus 50.4 in April.
Definition
The S&P Manufacturing Purchasing Managers' Index (PMI) is based on monthly a questionnaire that surveys of over 500 companies which provide an advance indication of what is really happening in the private sector economy by tracking changes in variables such as output, new orders, stock levels, employment and prices across the manufacturing sectors.
Description
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.
The S&P PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.
The S&P PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.
