Related Terms • Beige Book • CCI • ECI • Economic Indicator • Employee Cost Index • Employment Situation Report • Housing Starts

Definition: The Purchasing Managers Index is released on the first day of the month by the National Association of Purchasing Managers.  The PMI measures five factors in business: new orders, inventory levels, production, supplier delivers, and employment conditions.  Each of these five factors are adjusted and weighed according to time of year and other events.

The Bottom Line:  A PMI over 50% means that manufacturing is growing and expanding.  A PMI under 50% means that manufacturing is declining.  a PMI of 42.7% or more over a long period of time means the economy as a whole is expanding.  A PMI of 42.7% of below over a long period of time means the economy as a whole is contracting.