Chicago PMI: Increase In February, Still In Contraction Territory

The Chicago Business Barometer, also known as the Chicago Purchasing Manager's Index, is similar to the national ISM Manufacturing indicator but at a regional level and is seen by many as an indicator of the larger US economy. It is a composite diffusion indicator, made up of production, new orders, order backlogs, employment, and supplier deliveries compiled through surveys. Values above 50.0 indicate expanding manufacturing activity.

The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, rose to 49.0 in February from 42.9 in January, which is in contraction territory. Values above 50.0 indicate expanding manufacturing activity.

Here is an excerpt from the press release:

The Chicago Business Barometer, produced with MNI, edged up 6.1 points in February to 49.0, the highest level since August 2019. The index moved closer to the 50-no-change-threshold, shifting the three-month average up to 46.7. [Source]

Let's take a look at the Chicago PMI since its inception.

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Here's a closer look at the indicator since 2000.

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Let's compare the Chicago PMI with the more popular national ISM Manufacturing Index. Both indices clearly follow one another with the ISM falling slightly lower on average. Note the ISM Manufacturing indicator is through the previous month.

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