Econintersect: The Chicago Business Barometer fell into contraction in February – dropping 13.6 points. The authors of this index where surprised.
The market expected the index between 55.5 and 59.6 (consensus 58.7) versus the actual at 45.8. A number below 50 indicates contraction. From the authors of the index:
It is difficult to reconcile the very sharp drop in the Barometer with the recent firm tone of the survey. There is some evidence to point to special factors as the port strike and the weather, although we will need to see the March data to get a better picture of underlying growth.
The Chicago ISM is important as it is a window into the national ISM reports which will be issued shortly. When you compare the graph below of the ISM Manufacturing Index against the Chicago PMI (graph above) – there is a general correlation in trends, but not necessarily correlation in values.
source and read the full report: Chicago PMI
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