After reporting a substantial acceleration in the pace of growth in Chicago-area business activity last month, MNI Indicators released a report on Wednesday showing a slowdown in the pace of growth in the month of November.
MNI Indicators said its Chicago business barometer dipped to 63.0 in November after jumping to 65.9 in October, although a reading above 50 still indicates growth. Economists had expected the business barometer to drop to a reading of 60.5.
While the business barometer pulled back off the more than two-year high set in October, MNI Indicators noted that the three-month moving average reached its highest level since November of 2011.
A slowdown in the pace of new orders growth contributed to the drop by the business barometer, with the new orders index sliding to 68.8 in November from 74.3 in October.
The production index also fell to 64.3 in November from 71.1 in October, while the order backlogs index dipped to 59.8 from 61.0.
On the other hand, the report showed that the employment index climbed to 60.9 in November from 57.7 in October, reaching its highest level in two years.
The prices paid index also rose to 63.7 in November from 56.7 in October, while the inventories index surged up 13.1 points to 61.1, its highest reading since September of 2006.
Philip Uglow, Chief Economist at MNI Indicators said, "The Barometer might be down in November, but this was another impressive month with companies reporting firm growth."
"Having kept inventories lean for so long, a pick-up in demand has led to a sharp rise in stock building among the companies in our panel," he added. "And to handle the latest production and new orders boost, companies are hiring at the fastest pace for two years."
Next Monday, the Institute for Supply Management is scheduled to release its report on national manufacturing activity in the month of November.
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