Template-Type: ReDIF-Article 1.0
Author-Name: Burcu Erik
Author-Name: Marco Jacopo Lombardi
Author-Name: Dubravko Mihaljek
Author-Name: Hyun Song Shin
Title: Financial conditions and purchasing managers' indices: exploring the links
Abstract: Purchasing managers' indices (PMIs) have found a place in global conjunctural analysis and quarterly GDP nowcasting, serving as reliable concurrent indicators of real economic activity. They also closely mirror changes in equity prices and corporate bond spreads. More surprisingly, PMIs react to changes in the dollar index, and do so in a way that runs counter to a trade competitiveness explanation. We show that the financial variables help predict PMIs and explain a significant proportion of their variation. The two seem to be linked through shifts in macroeconomic sentiment and global financing conditions.
Journal: BIS Quarterly Review
File-URL: http://www.bis.org/publ/qtrpdf/r_qt1909g.pdf
File-Format: Application/pdf
File-URL: http://www.bis.org/publ/qtrpdf/r_qt1909g.htm
File-Format: text/html
Year: 2019
Month: September
Classification-JEL: C53, E27, F31, F47
Handle: RePEc:bis:bisqtr:1909g