Chicago Busi­ness Barom­e­ter Slipped in Au­gust

The Bond Buyer - - Market News - — Chip Bar­nett

The MNI Chicago Busi­ness Barom­e­ter slipped 1.9 points to a three-month low of 63.6 in Au­gust, down from July’s 65.5, the In­sti­tute for Sup­ply Man­age­ment re­ported on Fri­day.

The in­dex is still 6.9% higher on the year and con­tin­ues to sig­nal ro­bust busi­ness con­di­tions, ISM said.

Com­pa­nies’ op­er­a­tions con­tin­ued to grow at a healthy pace in Au­gust, de­spite drop­ping for the first time in five months. A soft­en­ing in sup­plier de­liv­er­ies, or­der back­logs and em­ploy­ment off­set gains in pro­duc­tion and new or­ders, ISM said.

“The MNI Chicago Busi­ness Barom­e­ter con­tin­ues to sig­nal solid busi­ness sen­ti­ment, de­spite eas­ing for the first time in five months, with growth in out­put and de­mand hold­ing up well,” said Jamie Satchi, econ­o­mist at MNI In­di­ca­tors. “In­fla­tion­ary pres­sures look set to con­tinue, po­ten­tially bleed­ing into con­sumer prices, with over 60% of firms re­port­ing that they have passed on higher in­put costs to cus­tomers in re­cent months, and oth­ers fore­see­ing do­ing so in the near fu­ture.”

Firms con­tin­ued to ex­pand their work­forces in Au­gust, de­spite the em­ploy­ment in­di­ca­tor slip­ping from July’s four-month high. The in­di­ca­tor has re­mained above the neu­tral thresh­old of 50 for the past 10 months in a row, the long­est stretch since April 2015.

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