Courtesy of Doug Short.
The Chicago Business Barometer, also known as the Chicago Purchasing Manager’s Index, is similar to the national ISM Manufacturing indicator but at a regional level and is seen by many as an indicator of the larger US economy. It is a composite diffusion indicator, made up of production, new orders, order backlogs, employment, and supplier deliveries compiled through surveys.
The February report for Chicago PMI came in at 47.6, an eight point decline from last month’s 55.6.
Here is an excerpt from the press release:
Chief Economist of MNI Indicators Philip Uglow said, “If one looks beyond the gyrations seen over the past three months then trend activity has been running a little below the 50 neutral mark, highlighting continued sluggish activity levels, with manufacturers under particular pressure. Still, given the weakness in Q4, it looks like activity should pick up during Q1.”
Let’s take a look at the Chicago PMI since its inception.
Here’s a closer look at the indicator since 2000.
Let’s compare the Chicago PMI with the more popular national ISM Manufacturing Index. Both indicies clearly follow one another with the ISM falling a bit lower on average. Note the ISM Manufacturing indicator is through the previous month.
