The November purchasing manager’s index for the ISM’s Chicago division hit 63. Analysts were expecting 60.
It’s down from last month’s 65.9, but the three-month average is now at the greatest level in two years.
The November Chicago Business Barometer softened to 63.0 after October’s sharp
rise to a 31-month high of 65.9. November’s slight correction came amid mild declines
in New Orders, Production and Order Backlogs after double digit gains in the prior
Despite November’s weakening, the Barometer remained well above 60 for the
second month, pushing the three month moving average to the highest level since
Chicago area purchasers continued to report healthy expansion in New Orders and
Order Backlogs, albeit at a slower rate, as well as a lengthening in Supplier Delivery
Inventories exploded 13.1 points to 61.1, moving out of contraction for the first time
since February and posting the highest reading since September 2006. With
expectations for higher demand, firms underwent a major stock rebuild.
Commenting on the MNI Chicago Report, Philip Uglow, Chief Economist at MNI
Indicators said, “The Barometer might be down in November, but this was another
impressive month with companies reporting firm growth”.
“Having kept inventories lean for so long, a pick-up in demand has led to a sharp rise in stock building among the companies in our panel. And to handle the latest production and new orders boost, companies are hiring at the fastest pace for two years,” he added.