Economy

Chicago Manufacturing Activity Strengthens in January

January 31, 2015

The Chicago Business Barometer rose 0.6 points in January to 59.4 from a revised reading of 58.8 in December. The increased manufacturing activity follows two consecutive months of declines.

The index showed a modest increase in a new orders, order backlogs and production, driving employment to a 14-month high.

Inflationary pressures eased for the fourth consecutive month and at faster rate in January due to low oil prices. Inventories of finished goods dropped 15 points, falling into contraction after strong growth in the second half of 2014.

Commenting on the Chicago Report, Philip Uglow, Chief Economist of MNI Indicators said, “This was a solid start to 2015 with current growth in orders and output consistent with ongoing strength in US GDP. Encouragingly, the January survey showed that strength we saw in the second half of 2014 is having a significantly positive impact on employment.“

”The sharp fall in input costs due to the lower oil price, evidenced by the lowest level of Prices Paid for more than five years, will have a positive impact on business activity as well as consumer spending.“