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Economy in Brief

Chicago Purchasing Managers Index Improves Steadily
by Tom Moeller November 30, 2009

The Chicago Purchasing Managers' Association reported that its November Business Barometer improved to the highest level since August of last year. The index level of 56.1 was up sharply from the March low of 31.4. The survey covers a sample of over 200 purchasing professionals in the Chicago area with a monthly response rate of about 50%. During the last ten years there has been a 72% correlation between the Business Barometer and the three-month change in factory sector industrial production.

The Association indicated that gains in the index of vendor deliveries (slower speed), order backlogs and employment contributed greatly to the November rise in the overall index. The new orders index rose modestly m/m but was more than double the year-ago level. The production component fell and reversed much of the prior month's increase. Nevertheless, it remained nearly double the January low.

The index of prices paid increased and made up an October decline. The latest level was more than double its May low. During the last ten years there has been a 78% correlation between the Prices Paid Index and the three-month change in the PPI for intermediate materials.

Why Are Banks Failing? from the Federal Reserve Bank of St. Louis can be found here .

Chicago Purchasing Mgs. November October September November '08 2008 2007 2006
  Business Barometer 56.1 54.2 46.1 33.6 46.8 54.4 56.8
    Production 57.6 63.9 47.2 34.1 48.1 58.3 60.3
    New Orders 62.8 61.4 46.3 29.2 46.7 57.7 59.9
    Employment 41.9 38.3 38.8 33.4 41.4 51.5 51.6
    Prices Paid 52.6 48.6 51.3 54.1 73.5 66.5 72.8
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