Chicago Business Barometer Indicates Notably Slower Growth In April
29 Abril 2016 - 5:10AM
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Indicating a slow start to the second quarter, MNI Indicators
released a report on Friday showing that growth in Chicago-area
business activity slowed by much more than expected in the month of
April.
MNI Indicators said its Chicago business barometer slumped to
50.4 in April after surging up to 53.6 in March.
While a reading above 50 indicates continued growth, the
barometer had been expected to show a much more modest drop to
53.4.
The bigger than expected drop by the barometer was led a
decrease by the new orders index, which fell to its lowest level
since last December.
The order backlogs also saw a double-digit decline, while the
employment index moved back into contraction after indicating
growth in the previous month.
On the other hand, the production index saw a small increase,
and the supplier deliveries index jumped to its highest level since
October of 2014.
The prices paid index also saw a significant jump, climbing back
into expansion for the first time in nine months.
The increase reflected a recovery in the oil price as well as
higher prices for some raw materials such as plastic and paper
products
Chief Economist of MNI Indicators Philip Uglow said, "This was a
disappointing start to the second quarter, with the Barometer
barely above the neutral 50 mark in April."
"Against a backdrop of softer domestic demand and the slowdown
abroad, panelists are now more worried about the impact a rate hike
might have on business than they were at the same time last year,"
he added.
In a special question, MNI Indicators found that 28.6 percent on
panelists believe an interest rate hike in the next months will
have an impact on business.
Only 21.2 percent said they expected to see a rate hike impact
business activity when the same question was asked last April.
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