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  • HSBC Purchasing Manager's Indices: A Must Know

    HSBC Purchasing Manager's Indices are monthly data driven picture of individual economies. HSBC PMIs cover 12 principal emerging economies of the world, including India, China, Russia, UAE and Saudi Arabia. PMI indices are complied using the data derived from interviews with senior purchasing executives and other highly effective market research techniques, thereby accurately measuring the economic activities of individual economies and report well before the other comparable official and government data.

    Typically the individual reports cover one key sector per country for example manufacturing or services.PMIs are among the most closely watched surveys in the world and are essential must-have data for economic analysts, financial market players and other decision makers such as central banks that require early indicators of changing market conditions when setting interest rates.

    Basic Interpretation of HSBC PMI Indices:
    The indices vary between 0 and 100 with a level of 50 signalling no change on the previous month. Any reading below 50 is the sign of growth coming off with relation to previous month. Recently issued data of China showed that its Manufacturing Purchasing Index for November 2011 fell to a 32-month low of 47.7 which means that China has actually slowed down the growth to reduce the inflation. And China was successful in it.

    Now since they are successful in reducing the inflation, I think, they are again shifting their focus from inflation to growth and cutting the bank reserve ratio is the first step towards that direction. 

    India's November PMI was at 51. So, India is not yet in that red zone as marked out by HSBC.

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    Prem-Profile-PhotoAbout the Author

    I am Prem, the founder of TheFinanceConcept. I am an Investment Advisor and a part-time blogger. I hold PG degree in MBA (Finance) and pursuing CFA. Blogging has become my passion from April 2011. I enjoy writing articles on Securities Analysis and Financial Planning.
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