2018 Economic Calendar
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PMI Composite FLASH  
Released On 9/21/2018 9:45:00 AM For Sep, 2018
PriorConsensusConsensus RangeActual
Composite – Level55.0 55.1 53.8  to 55.8 53.4 
Manufacturing – Level54.5 55.0 53.8  to 55.2 55.6 
Services — Level55.2 55.0 53.6  to 56.2 52.9 

Highlights
Amid a backdrop of rising inflation pressures, sharp slowing in the services PMI sample pulled down September's composite flash and masks a strong showing for manufacturing. The PMI composite fell to 53.4 which is well below Econoday's consensus for 55.1 and also below the low estimate for 53.8. Services fell to 52.9 vs a consensus for 55.0 while manufacturing, however, rose to 55.6 vs expectations for 55.0.

Weakness in services is centered in the year-ahead outlook which fell to its lowest level of 2018 reflecting concerns over cost pressures as input prices rose sharply and selling prices surged to a record high in survey data going back 10 years. Respondents to the service sample cited the need to pass through higher labor costs and increased input costs sourced from overseas. Cost concerns overshadow a rise in new orders, a build in backlogs, and a jump in hiring to a 3-1/2 year high.

The year-ahead outlook on the manufacturing side is also weak, slipping to a 2-1/2 year low as this sample cited higher costs tied to metal tariffs and the related need for forward purchasing. Some of these respondents said strong order levels are allowing them to push up selling prices. Yet other details, much like the service side of the report, are positive including rising orders and production. Another negative, however, is the slowest rate of hiring over the past year.

The service sector dwarfs manufacturing in size which explains its much greater impact on the composite. But though a fraction of the size of services, manufacturing is considered, however, a leading barometer for future economic change which is the silver lining in today's report. Yet not a silver lining at all is the inflation theme of the report, one that is certain to gain the attention of Federal Reserve policy makers who look to raise rates next week to defend against the risk of economic overheating.

Consensus Outlook
Moderation was the clear signal from the PMIs in August with many indications showing some of their lowest results of the year. For September's flashes, forecasters see little change with the consensus for the composite at 55.1 with manufacturing at 55.0 and services also at 55.0.

Definition
The flash Composite Purchasing Managers' Index (PMI) provides an early estimate of current private sector output by combining information obtained from surveys of around 1,000 manufacturing and service sector companies. The flash data are released around 10 days ahead of the final report and are typically based upon around 85 percent of the full survey sample. Results are synthesized into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) output versus the previous month and the closer to 100 (zero) the faster output is growing (contracting). The report also contains flash estimates of the manufacturing and services PMIs. The data are produced by Markit.  Why Investors Care
 

2018 Release Schedule
Released On: 1/242/213/224/235/236/227/248/239/2110/2411/23
Release For: JanFebMarAprMayJunJulAugSepOctNov
 


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