| Consensus | Consensus Range | Actual | Previous | |
| Index | 52.0 | 51.2 to 52.1 | 50.9 | 51.7 |
Highlights
The S&P Global China manufacturing PMI showed conditions in the sector weakened in July, with the headline index falling to a four-month low of 50.9 from 51.7 in June. This survey continues to show stronger conditions in the sector than official PMI survey data and has shown expansion in the sector for eight consecutive months
Respondents to the S&P PMI survey reported slower growth in output and new orders in July, but new export orders were reported to have risen after two consecutive declines. The survey also shows a second consecutive increase in payrolls in three months while its measure of business confidence shows firms are more optimistic about output growth over the next twelve months. Growth in input costs was reported to have been steady but selling prices were reported to have been increased at a slower pace.
Market Consensus Before Announcement
The index is expected to edge up to 52.0 in July from 51.7 in June, suggesting continued modest expansion in business activity.
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.