MNI Indicators’ report
revealed on Tuesday that the expansion of business activity in Chicago slowed
this month.
The MNI Chicago
Business Barometer, also known as Chicago purchasing manager's index (PMI) came
in at 52.6 in April, down from an unrevised 58.7 in March. That was the lowest
reading since October 2016.
Economists had forecast
the index to increase to 59.
A reading above 50
indicates improving conditions, while a reading below this level shows
worsening of the situation.
According to the report, four of the five Barometer components declined in April, with the new orders
falling for the second consecutive month. The production dropped significantly
to a level not seen since May 2016, while the employment indicator softened to
the lowest level since October 2017 and the factory gate prices saw the biggest
monthly fall since December 2008. Meanwhile, the order backlogs component was
the sole gainer.
“This was a disappointing start to the second quarter, with more firms cutting back on both
production and employment against a backdrop of softer domestic demand and the
global slowdown,” said Shaily Mittal, Senior Economist at MNI. “Most Barometer
components have dived below their respective 12-month averages, pointing
towards greater business uncertainty among firms,” she added.
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