Chicago Purchasing Manager Gives Back Last Month's Strength

Chicago purchasing manager's index settled back down toward earth in April after zooming up in March to a two year high. The headline figure slumped to 52.9 (consensus 54) from 61.7 the prior month. Any reading above 50 shows expansion, but the fall back to 52.9 indicates more subdued growth, in line with other surveys.

The Chicago purchasing managers index includes any member group. They don't have to be located in the Midwest, or even the US, which makes it a better proxy for overall U.S. manufacturing strength in many economists' opinion. The only two subcomponents to show strength were employment(which just rose above 50) and prices paid (which rose almost 6 points to 64.9) as energy prices work through the supply chain. All other subgroups fell from the prior month. New orders which surged in March to 72.2 fell back to 56.5 in April, but are still above the 48.7 reading of February. Production though remains firm at 62.2. Inventories weakened to 43.2 from 48.8.