UK August Composite PMI 60.1... Exceeds Expectations

by Lee Minwoo

Published 21 Aug.2020 17:50(KST)

Contrasting with the Eurozone, which contracted more than expected

[Asia Economy Reporter Minwoo Lee] The United Kingdom's composite Purchasing Managers' Index (PMI) exceeded expectations, presenting a stark contrast to the significantly contracted Eurozone (19 countries using the euro) PMI.

According to Bloomberg on the 21st (local time), the UK’s August composite PMI, jointly surveyed by market research firm IHS Markit and the Chartered Institute of Procurement & Supply (CIPS), stood at 60.3. This was higher than the expected 56.9 and the previous month’s 57.0. In contrast, the Eurozone’s August composite PMI recorded 51.6, significantly below the expected 55.0 and the previous 54.9.

The PMI is compiled monthly through surveys of purchasing managers regarding new orders, production, inventory, employment, and other factors. It serves as an indicator to gauge business conditions in manufacturing, services, and other sectors. Generally, a reading above 50 indicates economic expansion, while below 50 indicates contraction.

Specifically, the UK’s August services PMI also rose to 60.1, surpassing the previous 56.5 and the expected 57.0. This contrasts sharply with the Eurozone’s August services PMI, which fell to 50.1, well below the prior 54.7 and the expected 54.5.