–Markit Flash U.S. Manufacturing PMI Correlation With ISM PMI 0.89

By Yali N’Diaye

WASHINGTON (MNI) – Financial information services company Markit
announced the launch of a Flash U.S. Purchasing Managers’ Index later
this month, but it is already getting ready to add a services index by
the end of this year, Head of Markit Economics Luke Thompson told MNI
Thursday.

“I would think that we’d launch a U.S. services index — the flash
series — before the end of the year,” he said, adding Markit has been
collecting data in the sector for “over two years.”

While just having announced the creation of a U.S. manufacturing
index, the company is also seeking to expand its coverage
geographically, with a current focus on emerging markets, Thompson said,
without specifying countries.

The company announced on Tuesday it will publish its first Markit
Flash U.S. Manufacturing PMI on May 24, nine days ahead of ISM’s
monthly Manufacturing ISM Report on Business.

While the goal is not to predict the direction of the Institute for
Supply Management widely followed manufacturing survey, based on
historical data, “we provide a vey accurate indication of trend in
official U.S. manufacturing production,” Thompson told MNI.

He added that the correlation between the two headline PMIs was
0,89 over the five-year period starting in 2007.

Markit has been collecting PMI data from U.S. manufacturers since
May 2007, the company said Tuesday.

Thompson said there is no methodology difference between the U.S.
manufacturing survey and the one already existing in other countries.
Data collection worldwide for the flash survey takes place between the
12th of each month and the 22nd or 23rd.

When justifying the creation of the U.S. survey, Thompson said,
“the U.S. was the big economy that we were missing.”

But the company is still seeking to expand as other countries are
missing, “probably in the emerging markets,” Thompson said, without
specifying.

This geographical expansion allows to produce a global PMI “at a
much more detailed level,” he said.

According to Tuesday’s press release, “The Markit Flash U.S.
Manufacturing PMI is based on data compiled from monthly replies to
questionnaires sent to purchasing executives in over 600 manufacturing
companies.”

“The panel is stratified by North American Industrial
Classification System (NAICS) group, based on industry contribution to
U.S. GDP,” it added. “The flash estimate is typically based on
approximately 85% to 90% of total PMI survey responses each month and is
designed to provide an accurate advance indication of the final PMI
data.” The final PMI is released the first day of the month.

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MAUDS$]