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Economy in Brief
U.S. Existing Home Sales Increase in October--the First in Seven Months
The NAR reported that sales of existing homes in October increased 1.4% m/m to 5.220 million units (SAAR)...
U.S. Durable Goods Orders Decline, Led by Aircraft
Weakness in the durable goods manufacturing sector was evident last month as new orders declined 4.4% (+6.7% y/y)...
U.S. Initial Unemployment Claims Rise, Reach Highest Since June
Initial claims for unemployment insurance rose 3,000 in the week ended November 17 to 224,000 (-6.3% y/y)...
U.S. Housing Starts Increase
Total housing starts rose 1.5% (-2.9% y/y) during October to 1.228 million units (AR)...
Philadelphia Fed Nonmanufacturing Business Activity Rebounds
The Philadelphia Fed reported that its Nonmanufacturing Business Index of current conditions at the company level increased to 42.4 during November...
by Tom Moeller June 29, 2018
The Chicago Purchasing Managers Business Barometer increased to 64.1 during June from May's unrevised 62.7. It was the highest level since January, continuing its sharply rising trend during the last three years. The Action Economics Forecast Survey expected a decline to 60.8. The Chicago Purchasing Managers figures are diffusion indexes and readings above 50 indicate growth.
Haver Analytics constructs an ISM-Adjusted index with similar methodology as the ISM Composite Index. This index increased to 61.1 from 60.9 during May. It also was the highest level since January. During the last ten years, there has been a 67% correlation between the index level and the q/q change in real GDP.
The rise in the overall business barometer reflected broad-based improvement amongst the component series. The order backlog series strengthened to the highest level since October. The new orders series also gained and the rise in the vendor delivery series indicated the slowest rate of order fulfillment since November. Working the other way, the inventories series fell to the lowest point since last August, while the production index eased slightly.
The employment component rose modestly, though it remained down versus its January high. During the last ten years, there has been a 75% correlation between the index level and the m/m change in factory sector payrolls. Twenty-eight percent of survey respondents reported higher payroll levels and 14% indicated a decline.
The index of prices paid rose to 76.3, its highest level since May 2011. Sixty-three percent of respondents reported higher prices, a seven-year high, while four percent reported price declines.
The MNI Chicago Report is produced by MNI/Deutsche Borse Group in partnership with ISM-Chicago. The survey covers a sample of over 200 purchasing professionals in the Chicago area with a monthly response rate of about 50%. Summary data are contained in Haver's USECON database, with detail including the ISM-style index in the SURVEYS database. The Consensus expectations figure is available in AS1REPNA.
| Chicago Purchasing Managers Index (%, SA) | Jun | May | Apr | Jun '17 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|
| General Business Barometer | 64.1 | 62.7 | 57.6 | 63.6 | 60.8 | 53.1 | 50.3 |
| ISM-Adjusted General Business Barometer | 61.1 | 60.9 | 57.8 | 60.8 | 59.0 | 52.0 | 51.6 |
| Production | 64.6 | 65.0 | 59.0 | 66.2 | 64.3 | 54.7 | 52.5 |
| New Orders | 65.4 | 63.5 | 58.0 | 67.9 | 63.5 | 55.7 | 50.4 |
| Order Backlogs | 64.4 | 60.7 | 49.7 | 57.8 | 55.2 | 47.2 | 44.4 |
| Inventories | 52.8 | 54.9 | 53.8 | 53.0 | 54.9 | 47.2 | 52.1 |
| Employment | 55.2 | 54.7 | 52.1 | 55.6 | 52.9 | 49.4 | 50.3 |
| Supplier Deliveries | 67.5 | 66.4 | 66.0 | 61.2 | 59.4 | 52.8 | 52.6 |
| Prices Paid | 76.3 | 71.5 | 75.9 | 58.6 | 64.0 | 53.2 | 46.8 |
