The most interesting item in the data calendar is the Caixin service PMI from China, for December 2024.
We had official PMIs from China last week, where services showed significant improvement:
- China Official Dec Manufacturing PMI 50.1 (exp 50.3) Services 52.2 (exp 50.2)
- China’s Official National Bureau of Statistics (NBS) December 2024 PMI – Why the Long Face?
We also had the Caixin manufacturing PMI:
Today it is the PMI service from Caixin/S&P Global. I suspect it will improve from November. It is also a consensus. It is, of course, a completely different indicator compared to the official PMI services. I’ve provided a brief overview of the differences further down in the post if you’re interested.
- This snapshot from the ForexLive calendar of economic data, access it here.
- Times in the far left column are GMT.
- The numbers in the far right column are the ‘previous’ (previous month/quarter as the case may be) result. The number in the column next to it, where the number is, is the expected consensus median.
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Key differences between the official PMI service from China and the Caixin/S&P Global services PMI:
1. Compilation organizations
- Official services of PMI: Compiled by the National Bureau of Statistics (NBS) of China in cooperation with the China Federation of Logistics and Procurement (CFLP). It is part of the broader official PMI data, which includes manufacturing and non-manufacturing (services + construction) PMIs.
- Caixin/S&P Global Services PMI: Compiled by S&P Global based on a survey of private sector companies, sponsored by Caixin Media.
2. Target respondents
- Official PMI: Examines a larger sample size with a focus on state-owned enterprises (SOEs) and large companies. It reflects the performance of the wider economy, often influenced by the government.
- Caixin PMI: Focuses more on small and medium enterprises (SMEs) and private companies. It is considered a better indicator of the health of the private sector.
3. Methodology
Both indices use similar methodologies based on diffusion indices, where readings above 50 indicate expansion and below 50 indicate contraction. however:
- The Official PMI it has a broader scope because it includes construction activity in its non-manufacturing PMI.
- The Caixin PMI is more narrowly focused on the activity of the pure service sector.
4. Economic representation
- Official PMI: Often shows the trends they influence government policyinfrastructure projects and public sector activities. It may appear more stable due to the dominance of large, established firms.
- Caixin PMI: Reflects more dynamically private economywhich makes it potentially more unstable, but also more sensitive to changes in the business environment.
5. Time of release
- Official PMI: Published monthly, usually on the last day of the month for data for the previous month.
- Caixin PMI: Typically, published soon after in the first week of the following month.