Fundamental Major Currencies Report
 
Date: Monday, February 06, 2012
Last Update: 9:7:7 GMT
Ivey Purchasing Managers Index (Canada)
 
Previous 63.5
 
Forecast 59.7
    
Definition Is a monthly measure that shows the purchasing change of 175 corporate executive and managers from different regions and economic sectors, whether in the private or governmental sector, the report is released by joint membership between the Purchasing Management Association of Canada and the Richard Ivey School of Business. A headline value above 50 indicates a healthy condition over major economic sectors and indicates growth, as corporate increase their purchase, while any drop below 50 indicates contraction and slowing economic conditions. Ivey PMI consists of secondary indicators; such as spending indicator; employment indicator, inventory indicator, supplier deliveries and prices, all those companied shows clear future conditions for the manufacturing sector.
  
General Effect The report moves markets upon release; as it shows the purchasing and spending power for major corporate in the Canadian economy; each increase in the index indicates the rising demand of products and services by consumers. Therefore, the index is considered as a measure for the sector's contribution to growth and the state of the economy; in return, strong performance will lead to more optimism and will trigger companies to raise investment, employment, spending and productivity, enhancing the outlook for the Canadian economy, supporting the Canadian stock market and the Canadian dollar. The importance of this indicator is vital, incase a retraction in the indicator appears below 50, indicates bad conditions for companies and start worsening and give a clear thought about near economic recession; which might pressure the Central Bank to slash down the benchmark interest rate, forcing the Canadian Dollar to react negatively with the retracting index.
   
Best case scenario
  
Worst case scenario