What is PMI in Forex?
PMI (Purchasing Managers' Index)
Forex Trading Glossary
Quick Answer: PMI is a monthly survey of purchasing managers that signals whether manufacturing or services activity is expanding above 50 or contracting below 50. Because it is released early, PMI offers traders an advance look at growth trends.
What is PMI (Purchasing Managers' Index)?
PMI is a leading economic indicator derived from monthly surveys of private sector companies. A reading above 50 indicates economic expansion, while below 50 indicates contraction. PMI provides early insight into economic health before official GDP data is released.
PMI Interpretation
- Above 50: Expansion (bullish for currency)
- Below 50: Contraction (bearish for currency)
- Rising PMI: Accelerating growth
- Falling PMI: Slowing growth
Types of PMI
- Manufacturing PMI: Factory activity and production
- Services PMI: Service sector activity (larger in developed economies)
- Composite PMI: Combined manufacturing and services
Related Terms
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