Purchasing Managers' Index launched to gauge country's economic health

The Metropolitan Chamber of Commerce and Industry, in partnership with Policy Exchange Bangladesh, has launched the Purchasing Managers' Index (PMI) to measure the country's economic well-being and trends.

The initiative with the support of the UK government's Foreign, Commonwealth, and Development Office was launched on Monday at an event held at the chamber's Gulshan office in the capital.

The PMI is an economic indicator based on the perception of purchasing managers covering major economic sectors, including agriculture, construction, manufacturing and services.

Based on major survey areas such as new order, inventory levels, production, suppliers' deliveries and employment, the PMI values range from 0 to 100, while the value of 50 indicates no major change in the economic situation in the near future.

The PMI value over 50 indicates the possibility of a positive economic trend, while a value lower than 50 represents a shrinking trend of the economy.

Addressing the launching event, Matt Cannell, acting British high commissioner to Bangladesh, said the PMI is important for Bangladesh to prepare to face the economic challenges after the graduation from the least developed countries (LDCs) to a developing one in 2026.

"By leveraging real-time data and insights from the PMI, Bangladesh would be able to tackle future challenges effectively," he added.

After the LDC graduation, Bangladesh would need more foreign direct investment, and the index could play a crucial role in creating a conducive environment for attracting such investments.

Cannell further said the Bangladesh government's vision of an upper middle-income country by 2031, and a developed country by 2041 would depend on how the PMI would be used.

Addressing the event, Metropolitan Chamber of Commerce and Industry President Kamran T Rahman said PMI is widely used all over the world and is now being adopted in Bangladesh to reflect and address the unique characteristics of some of the major industrial sectors of the country.

"The PMI is more than just a set of numbers but a comprehensive raw data that will indicate the health and direction of the country's economy," he said.

Kamran further said the PMI will provide insights into sector specific economic activities, leading policymakers, analysts and investors to assess the current economic conditions.

M Masrur Reaz, chairman of the Policy Exchange Bangladesh, said the PMI will help generate and availability of regular robust data.