Chicago Business Index Sends Mixed Messages
The Chicago economy continues to expand, according to a new September Chicago Business Barometer report (link opens a PDF) released today by the Institute for Supply Management (ISM).
After clocking in at 53.0 for August, September's index managed to make it up to 55.7. Analysts were pleasantly surprised by the report, having expected a slightly more conservative bump to 54.4.
September marks the third straight month of index increases, its longest stretch of improvements in more than three years.
The ISM creates its index from surveys of purchasing and supply chain professionals based in Chicago. An above-50 rating indicates expansion, while below 50 implies a contraction from the previous month. Although the geographic focus is limited to the Chicago area, investors keep tabs on the index as a leading indicator of U.S. economic activity.
According to the report, this month's improvement stemmed primarily from gains in production, new orders, and supplier deliveries components. New orders hit their highest level since February, although orders backlogs made only a small gain to stay stuck below 50.
But a three-month dip in employment remains troublesome for sustainable growth. "While the pick-up is welcomed, growth is far from solid," said Chief Economist for MNI Indicators (an ISM partner) Philip Uglow in a statement today. "The easing in the employment component is a notable setback this month, underlying the fragility of the recovery."
The article Chicago Business Index Sends Mixed Messages originally appeared on Fool.com.
Fool contributor Justin Loiseau has no position in any stocks mentioned. You can follow him on Twitter @TMFJLo and on Motley Fool CAPS @TMFJLo.The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.