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Previous: 57.5 Expected: 58.1 Actual: 63.0
Canadian Purchasing Managers’ Index (PMI) released
The Canadian PMI is a purchasing managers’ confidence index for the Canadian manufacturing sector. It is conducted by Markit Corporation. When the index is above 50, it indicates expansion in the sector, and any reading below 50 indicates contraction.
If the indicator is higher than expectations:
• Refers to an improvement in business conditions and demand for Canadian products.
• Canadian companies are more optimistic about economic growth and increasing demand.
• Increases the likelihood of higher corporate spending and expansion of operations.
• May support an increase in the value of the Canadian dollar.
If the indicator is less than expected:
• Indicates declining demand and weak growth in the Canadian manufacturing sector.
• It appears that Canadian companies are less optimistic about increasing production and demand.
• Increases the likelihood of operating and spending cuts.
• It may weaken the value of the Canadian dollar.
Therefore, the Canadian PMI is an important gauge of the state of Canadian industry and economic growth prospects. He watches the sentiments of purchasing managers who know the market well.
Impact of Canadian Purchasing Managers Index (PMI) on Canadian Dollar Trading in Forex?
The release of the Canadian PMI affects the trading of the Canadian dollar in the following:
• PMI measures purchasing managers’ confidence in the industrial and business sector in Canada.
• When the index rises, which indicates an improvement in business conditions, this indicates a recovery in demand, production and growth in the industrial sector.
• This, in turn, increases the attractiveness of investment in Canada, which increases the demand for Canada’s currency, the “Canadian dollar”.
• This increased demand for the currency leads to an increase in its value against other currencies, and to make a profit for those who own the currency.
• The opposite is true when the index decreases, as this leads to a decrease in the demand for the Canadian dollar and its value.
• These changes in demand immediately reflect their impact on the Canadian dollar trading in the forex market.
The body responsible for issuing the Canadian Purchasing Managers’ Index (PMI)
The agency responsible for issuing the Canadian Purchasing Managers’ Index (PMI) is the advisory firm Markit.
Market is a Canadian consulting firm that specializes in conducting economic surveys and studies. It periodically surveys purchasing managers in Canadian companies to gauge the state of business and commercial activity in the manufacturing sector.
Based on the results of this survey, Markit releases the Canadian Purchasing Managers’ Index (PMI) monthly. The index measures changes in production levels, orders, raw material inventories, employment and prices in the Canadian manufacturing sector.
The index is published after its issuance by the company through the media, banks and financial institutions to be analyzed and its effects on the Canadian economy known.
When will the Canadian PMI be released?
It is released monthly, about 5 days after the end of the month
Next release
Jun 6, 2024
