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2005 U.S. Economic Events & Analysis
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NAPM-Chicago
Definition
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 10/31/05 For Oct 2005
Business Barometer Index, Level
 Actual 62.9  
 Consensus 57.0  
 Consensus Range 55.0  to  60.0  

Highlights
The Chicago purchasers' index held relatively stable in October following several months of extreme volatility, at 62.9 vs. 60.5 in September. New orders showed special strength, at 72.6 vs. 63.4 and pointing to future strength in overall business activity.

Prices paid, at 79.6 from 76.3, indicate both strength tied to demand and also the effects of high energy prices. Price indexes in October reports, especially tomorrow's reading in the ISM manufacturing report, may prove especially important to the financial markets. CPI and PPI data for September suggested a leveling off in October's gains, which is not indicated in Chicago's reading.

A good sign was a rise in employment to 51.3 from 48.4. A sharp and further slowing in supplier deliveries, to 63.6 from 57.4 in September, offers evidence of hurricane disruptions to shipping (also one of the factors driving up prices).

The report is not likely to have much impact on expectations for the ISM reports this week, though it will brace the markets for high price readings. Financial markets showed little reaction to the data.

Market Consensus Before Announcement
The NAPM-Chicago's business barometer surged to 60.5 in September after plunging to its lowest level in over two years in August. This index, which measures both manufacturing and non-manufacturing activity in the Chicago region, is often considered a leading indicator for the ISM manufacturing index. The Fed surveys were mixed in October with the New York area showing slower growth and the Philadelphia region more rapid growth.

NAPM-Chicago Consensus Forecast for Oct 05: 57
Range: 55 to 60
Trends
[Chart] 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.
Data Source: Haver Analytics

2005 Release Schedule
Released On: 1/31 2/28 3/31 4/29 5/31 6/30 7/29 8/31 9/30 10/31 11/30 12/30
Released For: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec


 
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