US ISM Manufacturing PMI
Manufacturing PMI index according to the Institute for Supply Management. Leading indicator. It is popular against the background of the interest in it in general as well as in particular the additional interest in its employment component which is used as an indirect benchmark before the publication of the American Non-Farm Payrolls. It has a sensitive limit line of 50.
Features of the publication
How to trade US ISM Manufacturing PMI
If the data exceeds the forecast, USDJPY grows.
After interviewing 300 manufacturers, the Institute for Supply Management, better known as the ISM, prepares summary data in the form of a PMI indicator, which includes the main parameters of business sentiments such as: production volumes, order quantity, employment, supplies, stocks, etc.
Traditionally, the indicator has a clear line of optimism for the PMI, set at the level of 50 of the basis point. Anything higher is good, anything lower is bad. The further we go from the mark of 50 to any side, the more one-sidedly the market looks at this indicator. For example, at a value of 45, it will be easier for us to sell on the news facts than to buy since there is a high probability that in case of growth under zone of 50, we are still in pessimism, and the economy has negative growth prospects.
It is interesting that this indicator is popular among market participants not only in its general expression.
Since ISM Manufacturing PMI is usually published before the publication of Non-Farm Payrolls the attention is drawn by its employment component.
Thanks to such variables as ISM PMI Employment and ADP Non-Farm Payrolls, the markets are trying to orient themselves before the forthcoming publication of the US labor market.
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