Chicago Business Barometer Rises in July
By Dave Sebastian
The Chicago Business Barometer rose in July as demand was strong
but firms remained concerned about supply-chain disruptions and
The barometer, also known as the Chicago Purchasing Manager
Index, rose to 73.4 this month, both a two-month high and the
second-highest pandemic-era reading. Economists polled by The Wall
Street Journal were expecting a reading of 64.1.
When the barometer is above 50, it means there is expansion. The
reading takes into account five components: new orders, order
backlogs, production, supplier deliveries indicators and
Production rose 8.8 points, posting the biggest gain in July, as
some firms benefited from supply-chain issues, MNI Indicators said
in a release.
Order backlogs reached a two-month high after advancing 3.4
points, according to the release. Companies noted a shortage of raw
materials and warehouse personnel, MNI Indicators added. Demand for
labor rose 3.4 points during the month as staff availability
remained subdued, it said.
Inventories rose 5.1 points, though it has been in contraction
since April, according to MNI Indicators.
MNI Indicators said supplier deliveries stayed at June's level
in July. Delivery delays remained a problem, it said.
Prices paid at the factory gate fell 0.3 points but remained at
a historically high level, MNI Indicators said. The firm said
survey respondents noted higher prices for materials and freight as
an ongoing concern.
MNI Indicators also asked those surveyed about their planned
business activity growth forecast for the second half of the year.
About 49% of respondents said they expect growth of 5% to 10%.
In response to a question on whether current inflationary
pressures are seen as transitory, 37.2% of respondents said they
were unsure, the firm said.
Write to Dave Sebastian at email@example.com
(END) Dow Jones Newswires
July 30, 2021 10:20 ET (14:20 GMT)
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