By Micah Maidenberg

The Chicago Purchasing Manager Index dropped in March.

The index, also called the Chicago Business Barometer, fell to 47.8 in March, down 1.1 points compared with February. March's reading was the ninth consecutive reading below 50, according to MNI Indicators, which produces the Chicago barometer.

Readings of more than 50 indicate an economic expansion, while those below 50 indicate a contraction.

The Chicago barometer was dragged lower in March as indicators for production and new orders both fell.

Production moved back into contraction in March after an increase in February put that indicator above the 50 mark. New orders dropped almost 8%.

"While some firms reported a rise in orders due to stockpiling by U.S. customers, others noted a fall in new business [due to] Covid-19," MNI said, referring to the illness caused by the new coronavirus.

Order backlogs were up in March and inventories moved deeper into a contraction. The indicator for employment was up slightly in March, following a decline last month.

Almost 41% of respondents said new orders, in three months, will be at the same as they were in the first quarter, while 31% expected them to be lower. About 29% see higher levels of new orders ahead.

Write to Micah Maidenberg at micah.maidenberg@wsj.com

(END) Dow Jones Newswires

March 31, 2020 10:31 ET (14:31 GMT)

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