Chicago business barometer rebounds to 58.8
The Chicago Business Barometer rose 11.7 points to 58.8 for September on Wednesday, from 47.1 in August, above a Wall Street Journal poll of 52.
Key takeaways
MNI Indicators' Chicago Business Barometer, the survey of managers who buy supplies around Chicago, rose 11.7 points in September, from 47.1 to 58.8, its highest reading since May.
A reading above 50 means more of those managers reported growth than reported a decline, and economists polled by The Wall Street Journal had expected 52.
The report said production, new orders, order backlogs and supplier deliveries drove the rise. Production rose 15.5 points and moved back above 50 after a month of contraction. New orders rose 13.3 points and took back part of the earlier drop, a move some respondents tied to a seasonal improvement in orders.
Supplier deliveries rose too, but a higher score there means slower deliveries, not faster ones. The report said no respondent reported faster delivery times than in August. It did not say whether that reflected demand or congestion.
Employment fell, and the report said the decline provided some offset. Employment is 10% of the barometer, against 35% for new orders and 25% for production, so that reading has less pull on the overall score than new orders and production.
A national survey already jumped
In August, Chicago fell to 47.1 while the Institute for Supply Management's national factory reading was still 54.6, above 50 for an eighth straight month.
September's rebound lines up with a national survey that also rose, though Chicago covers factories and other businesses and is not a direct match for a pure factory survey. S&P Global's early reading of US manufacturing, released on September 23, rose to 57.0 from 53.9, and the firm said all five components helped lift it. That figure is preliminary, not final.
Econoday, after May's release, called the index notoriously volatile and raised questions about the sample size and the method. In May the barometer rose 13.5 points, from 49.2 to 62.7, a larger gain than September's.
ISM's factory survey, due at 10 a.m. ET on Thursday, is the next national test, after an early reading that also rose in September.
Frequently asked
What is the Chicago Business Barometer?
It is MNI Indicators' survey of managers who buy supplies around Chicago.
Did the September reading beat forecasts?
Yes: it rose to 58.8 from 47.1, above a Wall Street Journal poll of 52.
What drove the rebound?
The report said production, new orders, order backlogs and supplier deliveries drove the rise.
Does a higher supplier-delivery score mean faster deliveries?
No: a higher score there means slower deliveries, and no respondent reported faster delivery times than in August.
