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2008 Economic Calendar |
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Resource Center » U.S. & Intl Recaps | Release Dates | Why Investors Care | Today's Calendar
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The National Association of Purchasing Management - Chicago compiles a survey and a composite diffusion index of business conditions in the Chicago area. Manufacturing and non-manufacturing firms are both surveyed, but until recently, market players have believed that the survey primarily covers the manufacturing sector. Readings above 50 percent indicate an expanding business sector. The NAPM - Chicago is considered a leading indicator of the ISM manufacturing index. Why Investors Care
| Released on 5/31/05 For May 2005 | ||||||||||
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Highlights
The Chicago purchasers' index dropped like a rock in May, in line with declines in other regional business surveys.
The Chicago business barometer index fell to 54.1 in May from 65.6 in April. New orders fell sharply to 57.9 from 71.0, indicating that a sharply declining proportion of respondents are reporting month-to-month gains.
This combined with a plunge in backlogs, which fell to 44.4 from 52.4, point to slowing production in the months ahead.
Prices paid likewise slowed, reflecting easing pricing power. At from 66.1 in April to 54.3 in May, the prices index is at its lowest since 2003, just at the time of the cyclical uplift in manufacturing.
But the Chicago index is a mix of manufacturing and non-manufacturing companies. The report offers a snap-shot of the region's business activity, which may be in a bit of trouble.
Employment fell with other readings, to 54.7 from 62.3 in April. Further declines are likely given the fall-off in orders.
The results were released with a contrasting Conference Board report on consumer confidence that showed a good gain. Bonds and stocks dipped in reaction to the data while the dollar firmed. The fall in the Chicago report, telegraphed by the Empire State and Philadelphia Fed reports, may have been less of a surprise than the rise in consumer confidence.
In any case, the Chicago results are certain to lower expectations for tomorrow's national purchasing survey from the ISM on the manufacturing sector, a report that has been showing consistently slower rates of month-to-month growth.
The NAPM-Chicago's business barometer fell back in April to 65.6. This index, which measures both manufacturing and non-manufacturing activity in the Chicago region, was still strong for the month. It remains to be seen whether activity remained healthy in May given that two key Fed surveys (Philly Fed and Empire State) declined in May.
NAPM-Chicago Consensus Forecast for May 05: 60.3
Range: 58 to 65
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The NAPM-Chicago Survey registers manufacturing and non-manufacturing activity in the Chicago region. Investors care about this indicator because the Chicago region mirrors the nation in its distribution of manufacturing activity. Consequently, the NAPM-Chicago survey often moves together with the ISM index, but is reported one day in advance. |
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