Chicago-area business activity saw a modest acceleration in the pace of growth in the month of June, according to a report released by the Institute for Supply Management - Chicago on Friday, although the index of activity crept up by less than economists had expected.
The report showed that the Chicago business barometer inched up to 52.9 in June from 52.7 in May, with a reading above 50 indicating an increase in activity. Economists had expected the index to climb to a reading of 53.1.
A notable acceleration in the pace of production growth contributed to the increase by the headline index, as the production index jumped to 57.0 in June from 50.0 in May.
The employment index also climbed to 60.4 in June from 57.0 in May, pointing to the broadest hiring since February.
On the other hand, the new orders index slipped to 51.9 in June from 52.9 in the previous month, indicating a continued slowdown in the pace of new orders growth.
The order backlogs index also dropped to 42.2 in June from 46.3 in May, with the reading below 50 indicating a further contraction.
With regard to inflation, the prices paid index fell to 54.0 in June from 60.4 in May, suggesting the third consecutive month of slowing inflation.
Next Monday, the Institute for Supply Management is scheduled to release its report on national manufacturing activity in the month of June. The report is likely to attract attention in light of some recent signs of weakness in the manufacturing sector.
The May report showed that the ISM's index of activity in the manufacturing dropped to 53.5 from 53.8 in April, although a reading above 50 indicates continued growth in the sector. Economists had been expecting the index to edge down to a reading of 54.0.
by RTT Staff Writer
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