Bottom line: the average of forecasting models suggest October ISM Manufacturing at 50.6, a bit above market consensus of 50.0. Looking only at the regional PMIs suggest ISM @50.5.

With all the key regional PMI's and the flash Markit PMI already released let's take a look at what can be inferred for the ISM. The chart below plots the ISM against the first principal component of all the remaining PMI's (also adding the GSAI - Goldman Sachs Analyst Index). It suggests October ISM at 50.5, a bit above market consensus.

Expanding the analysis, one can torture the numbers to come up with several competing forecasting models. This can range from simple Box-Jenkins and univariate time series filters to models using the principal components of regional PMI's and a mix of both.

Important to note that a simple random-walk forecast for the ISM Manufacturing is very competitive in terms of the measures of forecasting accuracy.

The literature on forecasting often suggest that combining different forecasting models produces, on average, better forecasts -- so let's give it a try.

Table below show the average point forecast for June's ISM Manufacturing as well as the range of point forecasts provided by the models I've tried.
Important: do not confuse this range with forecasting uncertainty; the error margins of the forecasting models are well wider than what is implied in the range of point forecasts.


Average forecastPoint forecast rangeBloomberg surveyBloomberg rangeActual
Sep 201459.158.3-60.658.557.0-60.056.6
Oct 201457.456.5-60.256.255.0-58.659.0
Nov 201458.057.2-59.058.054.5-61.058.7
Jan 201554.352.9-55.654.552.0-56.553.5
Mar 201552.149.6-52.952.549.5-55.051.5
Apr 201551.450.2-52.452.050.3-54.051.5
May 201551.149.6-52.352.050.0-52.5
52.8
Jun 2015
53.051.4-53.953.252.0-55.0
53.5
Oct 2015
50.6
50.1-52.3
50.0
48.9-51.5