EmailThe Chicago Purchasing Managers Index from Kingsbury International, Ltd., fell from 67.6 in April to 56.6 in May. The Briefing.com consensus expected the Chicago PMI to fall to 62.5.
This was the third, consecutive deceleration in the Chicago PMI and points to an overall softening in manufacturing in the Chicago region.
While both the production and new orders indices remained in an expansion phase, the indices fell substantially in May. The production index tumbled from 70.0 in April to 56.0 in May. The new orders index fell from 66.3 to 53.5.
Since the Chicago region is heavily reliant on automobile manufacturing, it is unknown how much of the slowdown from parts shortages in Japan factored into the May data.
Order backlogs dropped from 62.4 in April to 51.7 in May. If new orders slip again next month, the lack of a sizable backlog could cause production to contract in June.
The employment index fell from 63.7 to 60.8, but remains at a high enough level to support payroll growth.
