United States USD

United States ISM Prices Paid

Impact:
Medium
Source: Institute for Supply Management

Latest Release:

Date:
Surprise:
-4.5
| USD
Actual:
35.5
Forecast: 40
Previous/Revision:
39
Period: Nov
What Does It Measure?
The ISM Prices Paid index measures the prices that purchasing managers pay for raw materials and services as part of their overall procurement process. Its primary focus is to assess inflationary pressures in the manufacturing sector within the United States, gauging how escalating or decreasing input costs affect production and operational decisions.
Frequency
The ISM Prices Paid index is released monthly, typically on the first business day of the month, and is considered a preliminary estimate, which later may be revised with final reports.
Why Do Traders Care?
Traders pay close attention to the ISM Prices Paid index as its fluctuations can signal inflation trends that influence monetary policy decisions by the Federal Reserve. A higher-than-expected reading could lead to a strengthening of the USD and sell-offs in equities due to anticipated interest rate hikes, while a lower reading might suggest easing inflation pressures.
What Is It Derived From?
The index is derived from a survey of purchasing managers, who report on the prices they are currently experiencing for various inputs. It utilizes a diffusion index methodology where responses are weighted to account for the size of industries, allowing for a comprehensive snapshot of price changes across sectors.
Description
The ISM Prices Paid index is based on a diffusion index that represents the percentage of respondents reporting higher prices versus those reporting lower prices. It is calculated using a 0-100 scale, where values above 50 indicate expanding prices, while those below signify contracting prices. This index serves as an important measure, illustrating potential inflationary pressures within the manufacturing sector.
Additional Notes
The ISM Prices Paid index is considered a leading indicator of inflation, offering insights into cost pressures before they affect consumer prices broadly. It is often compared with other indicators like the Consumer Price Index (CPI) and Producer Price Index (PPI), as it provides a timely glimpse into upcoming inflation trends and reflects broader economic conditions.
Bullish or Bearish for Currency and Stocks
Higher than expected: Bullish for USD, Bearish for Stocks. [Hawkish] tone: Signaling higher interest rates or inflation concerns, is usually good for the USD but bad for Stocks due to higher borrowing costs.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number Better than forecast for the currency (or previous revise better)
Red Number Worse than forecast for the currency (or previous revise better)
Hawkish Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish Favors lower rates to boost growth, weakening the currency but lifting stocks.
Date Time Actual Forecast Previous Surprise
Dec 01, 2015
35.5
 40
39
 -4.5
Nov 02, 2015
39
 38
38
 1
Oct 01, 2015
38
 39.3
39
 -1.3
Sep 01, 2015
39
 42.5
44
 -3.5
Aug 03, 2015
44
 49.4
49.5
 -5.4
Jul 01, 2015
49.5
 51
49.5
 -1.5
Jun 01, 2015
49.5
 42.5
40.5
 7