Highlights
* According to the Institute of Supply Management-Chicago and Kingsbury International, Ltd., the Chicago Purchasing Managers Index increased to 39.9 in June from 34.9 in May. That was better than the consensus estimate of 39.0 and above the 6-month average of 35.6.
* The June number improved month-to-month, aided by an uptick in new orders, which jumped to 41.6 from 37.3. In fact, increases were seen in every component index, although some increases didn't necessarily imply encouraging things.
* The inventories index went up to 34.2 from 31.5 and prices paid increased to 36.3 from 29.8.
* Separately, production improved to 39.3 from 38.1, order backlogs increased to 37.6 from 26.3, and employment edged up to 28.9 from 25.0.
* The full report is available at www.kingbiz.com
Key Factors
* A reading below 50 still connotes a contraction in manufacturing activity in this region, although the uptick from May implies the rate of contraction has slowed.
* This survey was better than expected, but one needs to be careful not to extrapolate too much encouragement from it just yet knowing that it follows on the heels of a very problematic period for the auto industry, which is closely linked to the Chicago region. In other words, it could simply mark a temporary bounce from a very depressed situation.
Big Picture
* The Chicago PMI has little overall economic value, and is only watched by the financial markets because it is usually released one day in advance of the similar national ISM manufacturing survey. A significant move in this regional survey will therefore sometimes be seen as having predictive value for the ISM index.
Friday, July 31, 2009
Chicago PMI - June
Full report here
Highlights
* According to the Institute of Supply Management-Chicago and Kingsbury International, Ltd., the Chicago Purchasing Managers Index increased to 39.9 in June from 34.9 in May. That was better than the consensus estimate of 39.0 and above the 6-month average of 35.6.
* The June number improved month-to-month, aided by an uptick in new orders, which jumped to 41.6 from 37.3. In fact, increases were seen in every component index, although some increases didn't necessarily imply encouraging things.
* The inventories index went up to 34.2 from 31.5 and prices paid increased to 36.3 from 29.8.
* Separately, production improved to 39.3 from 38.1, order backlogs increased to 37.6 from 26.3, and employment edged up to 28.9 from 25.0.
* The full report is available at www.kingbiz.com
Key Factors
* A reading below 50 still connotes a contraction in manufacturing activity in this region, although the uptick from May implies the rate of contraction has slowed.
* This survey was better than expected, but one needs to be careful not to extrapolate too much encouragement from it just yet knowing that it follows on the heels of a very problematic period for the auto industry, which is closely linked to the Chicago region. In other words, it could simply mark a temporary bounce from a very depressed situation.
Big Picture
* The Chicago PMI has little overall economic value, and is only watched by the financial markets because it is usually released one day in advance of the similar national ISM manufacturing survey. A significant move in this regional survey will therefore sometimes be seen as having predictive value for the ISM index.
Highlights
* According to the Institute of Supply Management-Chicago and Kingsbury International, Ltd., the Chicago Purchasing Managers Index increased to 39.9 in June from 34.9 in May. That was better than the consensus estimate of 39.0 and above the 6-month average of 35.6.
* The June number improved month-to-month, aided by an uptick in new orders, which jumped to 41.6 from 37.3. In fact, increases were seen in every component index, although some increases didn't necessarily imply encouraging things.
* The inventories index went up to 34.2 from 31.5 and prices paid increased to 36.3 from 29.8.
* Separately, production improved to 39.3 from 38.1, order backlogs increased to 37.6 from 26.3, and employment edged up to 28.9 from 25.0.
* The full report is available at www.kingbiz.com
Key Factors
* A reading below 50 still connotes a contraction in manufacturing activity in this region, although the uptick from May implies the rate of contraction has slowed.
* This survey was better than expected, but one needs to be careful not to extrapolate too much encouragement from it just yet knowing that it follows on the heels of a very problematic period for the auto industry, which is closely linked to the Chicago region. In other words, it could simply mark a temporary bounce from a very depressed situation.
Big Picture
* The Chicago PMI has little overall economic value, and is only watched by the financial markets because it is usually released one day in advance of the similar national ISM manufacturing survey. A significant move in this regional survey will therefore sometimes be seen as having predictive value for the ISM index.
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