(RTTNews) - Business activity in the Chicago-area expanded at a faster than expected rate in the month of February, according to a report released by the Institute for Supply Management - Chicago on Wednesday, with the index of regional activity rising to a ten-month high. The report showed that the Chicago business barometer jumped to 64.0 in February from 60.2 in January, with a reading above 50 indicating an expansion. Economists had been expecting the index to edge up to a reading of 61.0.
With the much bigger than expected increase, the Chicago business barometer rose to its highest level since coming at 67.6 in April of 2011.
A significant acceleration in the pace of new orders growth contributed to the increase by the headline index, with the new orders index rising to 69.2 in February from 63.6 in January. The increase lifted the new orders index to an eleven-month high.
The production index also showed a notable increase, climbing to 67.8 in February from 63.8 in January. With the increase, the production index reached its highest level since April of 2011.
The report also showed a substantial acceleration in the pace of job growth, with the employment index surging up to 64.2 in February from 54.7 in January. The employment index is now at its highest level since coming in at 65.0 in May of 1984.
While the order backlogs index also climbed to 53.6 in February from 48.3 in January, the inventories index dropped to 49.6 from 51.6 in the previous month.
On the inflation front, the prices paid index rose to 65.6 in February from 62.4 in January, indicating an acceleration in the pace of price growth.
Miller Tabak's Peter Boockvar said, "In the face of a European recession and economic slowdown in Asia, in a very mild winter American manufacturing has shown clear signs of resiliency and tomorrow's national ISM, cobbling together all the regional surveys, is supposed to be the best since June."
Thursday morning, the Institute for Supply Management is scheduled to release its report on national manufacturing activity in the month of February. The index of activity in the sector is expected to climb to 54.6 in February from 54.1 in January.
