Economy

Chicago Business Barometer Bounces Back in August

August 29, 2014

The Chicago Business Barometer rebounded in August to 64.3, gaining 11.7 points and making up the decline in July’s Purchasing Manager Index (PMI). The August jump confirmed that July’s weakness was only temporary, according to Philip Uglow, Chief Economist at MNI Indicators.

Production rose by 20 points to its greatest monthly increase in ten years. New orders and backlogs regained and exceeded the points lost in July. Employment was lower for the month but remained in growth territory above a reading of 50.

Inventories grew at the fastest pace in eight years as firms anticipate higher future demand. Supplier delivery times increased for the fourth consecutive month.

Prices paid were above the 60 mark but MNI says “at this level it doesn’t point to a severe inflationary threat.”

“We had speculated that July’s downturn would prove temporary rather than signal the start of a downward trend. The sharp bounceback in August, with growth in output at the highest for nearly ten years, suggests that growth in the US economy will continue apace in Q3,” said Uglow.

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{amchart id=”111″ Chicago Business Barometer Index}