The Chicago Business Barometer pulled out of contraction in July with a gain of 5.3 points to register 54.7, indicating an expansion in manufacturing activity.
Production rose by 12 points to 61.8 accompanied by a strong gain in new orders. Both production and new orders expanded at the fastest pace since January.
Employment levels, order backlogs, and supplier deliveries remained in contraction during July.
The index for prices paid rose to 54.5, a growth of 1.2 points and the third consecutive increase.
“The recent weakness in the Chicago Business Barometer had sounded a few alarm bells over the resilience of the US economic recovery,” said Chief Economist of MNI Indicators Philip Uglow. “The positive start to the third quarter, however, suggests that activity bounced back firmly as firms saw orders and output increase sharply.”
The Chicago Business Barometer is an economic indicator based on surveys of purchasing/supply chain professionals in the Chicago area. A monthly publication of MNI Indicators and the Institute for Supply Management, the index is based on responses of manufacturing and non-manufacturing firms who primarily are members of ISM. An index reading above 50 indicates expansion while a number below 50 indicates contraction.
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