The Chicago Purchasing Managers Index (Chicago PMI) is an economic indicator that offers valuable insights into the manufacturing and business conditions in the Chicago region.

It serves as a barometer for the health of the region’s diverse industries, including manufacturing, transportation, and financial services.

As a leading indicator, the Chicago PMI can offer early warnings of potential changes in the broader U.S. economy, making it a valuable tool for investors and traders.

What is the Chicago PMI?

The Chicago PMI, also known as the Chicago Business Barometer, is a monthly report that measures the health of the manufacturing and non-manufacturing sectors in the Chicago area.

It is based on a survey of purchasing managers from various industries who provide their outlook on factors such as new orders, production, employment, supplier deliveries, and inventory levels.

The index is calculated by taking the percentage of respondents who report an increase in these factors and adding it to half the percentage of respondents who report no change.

  • An index value above 50 indicates expansion.
  • An index value below 50 signifies a contraction.

The Chicago PMI is closely watched by economists, investors, and policymakers as it can provide early signals of changes in the broader U.S. economy.

Why is the Chicago PMI important?

The Chicago PMI is important for several reasons:

  • Regional economic health: The Chicago area is home to a diverse range of industries, including manufacturing, transportation, and financial services. The Chicago PMI offers insights into the health of this crucial economic hub, reflecting broader trends in the U.S. economy.
  • Manufacturing sector: As a significant component of the overall U.S. economy, the manufacturing sector is an essential driver of economic growth and job creation. The Chicago PMI helps gauge the strength and vitality of this sector.
  • Leading indicator: The Chicago PMI is considered a leading indicator, meaning it can provide early warnings of shifts in the national economy. This makes it a valuable tool for investors and policymakers in their decision-making processes.
  • Market impact: The release of the Chicago PMI often impacts financial markets, particularly stocks, bonds, and currencies, as it can influence investor sentiment and expectations about future economic conditions.

Who publishes the Chicago PMI important?

The Chicago PMI is published by the Institute for Supply Management-Chicago (ISM-Chicago), in partnership with MNI Indicators, a market intelligence firm.

The data is compiled based on a survey of purchasing managers from a diverse range of industries in the Chicago area, who provide their insights on the factors mentioned earlier.

When is the Chicago PMI released?

The Chicago PMI is released every month, typically on the last business day of the month.

It is available to the public through the ISM-Chicago website.

The report includes a summary of the findings, the index value, and a detailed breakdown of the individual components of the index.