The most recent Chicago Purchasing Manager's Index (Chicago Business Barometer) experienced a decline to 37.9 in April, down from 41.4 in March. This marks the fifth consecutive monthly decrease and represents the lowest level for the index since November 2022. Notably, this reading falls below the forecasted 44.9 and maintains the index within contraction territory for the fifth consecutive month.
Now, let's delve into a comparison between the Chicago PMI and the widely recognized national ISM manufacturing index. Over 650 monthly data points, the Chicago PMI has surpassed the ISM index 71% of the time. Despite this notable majority, it's intriguing to observe that the historical average of the Chicago PMI, standing at 54.6, only slightly exceeds the ISM's average of 52.6. This observation underscores the close relationship between these two indices.
The Chicago PMI serves as a vital indicator for assessing business conditions and the economic health of the manufacturing sector within the Chicago region. A value above 50.0 indicates expanding manufacturing activity, while a value below 50.0 signifies contracting manufacturing activity. This metric offers valuable insights into the performance of the manufacturing sector, serving as a barometer for broader economic trends.