The July Chicago Purchasing Managers Business Barometer recovered most of its June decline with an 8.3 point rise to 64.7. Consensus expectations had been for a lesser rise to 60.0.

During the last ten years there has been a 74% correlation between the level of the Chicago Business Barometer and three month growth in factory sector industrial output.

The new orders index surged 11.9 points to 68.7 after the 17.6 point drop in June. Production made up almost all of its June skid with a 15.6 point surge to 69.5.

The employment index dropped sharply to 45.6, the lowest level in a year and an indication that job growth stopped. During the last twenty years there has been an 80% correlation between the level of this employment index and the three month change in factory sector employment.

The index of prices paid eased to 77.6, the lowest in three months.