“[It is the] best single measure of global economic activity in real-time” stated the Bank of England describing The Purchasing Managers Index (PMI).
The Purchasing Managers' Index (PMI) is an index of the prevailing direction of economic trends in the manufacturing and service sectors. It gives insights into whether the market environment is expanding or contracting as viewed by purchasing managers.
This week, the Services PMI is expected to be released in the US which is one of the leading economic indicators that provides insights into the performance of the economy.
The US Services PMI is expected to come in at 51, the same as the preliminary figure during August, declining from 52.3 in July 2023. Full recovery is still not within sight, but the green color is though. Despite household employment growing by 222,000 in August, it was still inadequate to absorb the 736,000 people who entered the force, causing the unemployment rate rise to 3.8%, the highest rate since February 2022.
The monetary policy decisions are data-driven; therefore, the market keeps a close eye on them to speculate the next moves of the Fed especially regarding the federal fund rate, currently at 5.5% which is expected to be held the same during the next MPC meeting.
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