The Mexico Manufacturing Purchasing Managers’ Index (PMI), first semester 2012
By Adina Moloman
Sources: Reuters, HSBC
The Purchasing Managers’ Index (PMI) is an indicator produced by Markit Group, a global financial information services company, the Institute for Supply Management and HSBC, a well known banking and financial services organization. This indicator was created to reflect the financial activity based on acquisition of goods and services (purchasing managers).
The Purchasing Managers’ Index™ (PMI™) surveys are well known for their accuracy in anticipating official data; widely used by economic analysts, financial market players, central banks that require early indicators of changing market conditions when setting interest rates. The surveys cover private sector companies, but not the public sector and reflect the change in the current month compared to the previous month based on data collected mid-month.
The PMI index is based on the next variables: new orders, inventory levels, production, supplier deliveries and the employment environment.
As for Mexico Manufacturing, this index, which measures the Mexican business conditions in the industrial sector is continuing to show positive results: it is registering increases in new export orders, it is also reflecting economic growth starting with the first quarter of 2012 which is closely related to a high demand from the United States.
A negative aspect detected was an increase in input costs. It is also expecting higher inflation, the Central bank targets 3 percent inflation, but remaining stable at least until early 2014.
Today’s strategy of policymakers is to focus on promoting growth rather than on limiting inflation.
On the other hand The HSBC Emerging Markets Index (EMI)[1] reveals that China has reported a reduced production for the third quarter in a row.
China was the only one of the big-four emerging markets (BRIC) to register lower manufacturing production, while Brazil recorded a rise in production since 2011. Chinese manufacturers are going through a reduction in buying activity for three years.
[1] The HSBC Emerging Markets Index (EMI) is an indicator based on national Purchasing Managers’ Index™ (PMI™) surveys of 5,800 reporting companies in the emerging markets of Brazil, Russia, India, China, Czech Republic, Hong Kong, Israel, Mexico, Poland, Singapore, South Africa, South Korea, Taiwan, Turkey, UAE, Saudi Arabia.
