Institute for Supply Management’s report revealed on Monday that
business activity in Chicago continued to contract in September, albeit at a slower
pace than in August.
The Chicago Business Barometer, also known as the Chicago purchasing
manager's index (PMI) came in at 46.6 in September, up from an unrevised 46.1 in the previous month. That pointed to the tenth straight month
of shrinkage in activity in the Chicago Fed region.
Economists had predicted the indicator to increase to 46.2 in September.
A reading above 50 indicates an expansion of activity, while a reading
below this level points to a contraction.
According to the report, the uptick in the index was due to significant improvements
in two of the five subcomponents Order Backlogs (+5.3 points) and Employment (+5.0
points). These gains, however, were partly offset by decreases in Supplier
Deliveries (-4.9 points), New Orders (-1.1 points), and Production (-1.1 points).
The report also revealed that Prices Paid jumped by 8.3 points, making
it the highest since August 2023 and significantly above the YTD average of
64.6.