Tonight at 22:45 Beijing time, the December Chicago Purchasing Managers' Index (PMI) in the US will be released. This data is crucial for the year-end trend of the global financial markets, and traders are eagerly awaiting it.

First, let's discuss why this index is important. The Chicago PMI is known as the "Industrial Barometer" of the US economy, covering local manufacturing and non-manufacturing purchasing managers' samples. It monitors hard indicators such as new orders, production, employment, and inventories. The changes in these indicators are highly correlated—up to 60%—with the overall US economic trend. In other words, by looking at Chicago's data, you can generally infer what the US economy is doing.

Using 50 as the dividing line, this is a simple but critical rule: above 50 indicates expansion, below 50 indicates contraction. If it drops close to 40, it should raise recession warnings.

Looking back at the entire year of 2025, the recovery of the US manufacturing sector has not been smooth. The average PMI for the year is estimated at 48.5, with most of the time spent in contraction territory. In November, the data fell to 36.3, reflecting significant pressure on traditional manufacturing. The expected value for December is 39.8, which is a rebound compared to November but still below the 50 threshold. The rebound is there, but whether the momentum can be sustained remains a key question.

On the positive side, several forces are supporting the sector. The AI investment boom is still ongoing, boosting order demand in tech manufacturing; major companies like Intel are building new factories domestically, stimulating industry chain activity. Companies are also taking actions—diversifying suppliers and stockpiling in advance to ease supply chain bottlenecks. Surveys show that 79% of manufacturing firms have a positive outlook on current business conditions, which is a relatively high proportion.

However, the pressure should not be underestimated. Trade protectionist policies have driven up raw material costs, which is a major cost pressure for manufacturing companies. Labor shortages remain tight, with 400,000 manufacturing jobs unfilled, leading to rising labor costs. The supply chains for industries like automobile manufacturing are still volatile, and these factors could all weigh down the data performance.

Therefore, when the PMI data is released, whether it can continue the rebound trend is a question market participants are watching. If the data surpasses expectations and breaks upward, it could support risk assets at the end of the year; if it remains sluggish, concerns about a global recession may intensify. Whatever the outcome, this night's data will be an important reference for market sentiment in the coming period.