A recent study by MNI Indicators revealed that business activity in the Chicago area had unexpectedly shrunk at an accelerated pace in March.
According to the report by MNI Indicators, the Chicago business barometer, which measures the overall economic health of the business sector, dipped from 44.0 in February to 41.4 in March. A barometer reading below 50 signifies economic contraction, contrary to economists' prediction of an increase to 46.0.
The report stated that this drop marked the fourth month of consecutive decline for the business barometer, bringing it to its lowest point since May 2023.
An important factor contributing to this downward trend was a significant reduction in order backlogs, causing the order backlogs to drop by 11.4 points, resulting in the third-lowest mark in the last 15 years.
Also reported were decreases in the new orders index and the supplier deliveries index, notching down by 3.4 and 1.6 points, respectively. These nosedives drove their levels to the lowest since the fall of 2023.
However, MNI Indicators pointed out that a rise in employment served as a silver lining, mitigating the overall drawback. The employment index witnessed a rebound of 6.4 points, indicating a positive shift in employment numbers.
Furthermore, the report noted a 2.1 point slide in the prices paid index down to its lowest since November 2023, as organizations made active efforts to control costs.
