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Title: Chicago Manufacturing Activity Expands At Faster Pace In February
Source:
RTTNEWS
URL Source: http://www.rttnews.com/ArticleView.aspx?Id=1224369
Published: Feb 26, 2010
Author: RTTNEWS
Post Date: 2010-02-26 11:55:59 by Brian S
Keywords: None
Views: 214
(RTTNews) - Friday morning, the Institute for Supply Management - Chicago released its report on regional manufacturing activity in the month of February, showing that its index of activity in the manufacturing sector unexpectedly increased. The ISM - Chicago said its business barometer index rose to 62.6 in February from 61.5 in January, with a reading above 50 indicating growth in the manufacturing sector. The increase came as a surprise to economists, who had expected the index to slip to 59.7. With the unexpected increase, the index rose to its highest level since April of 2005. The ISM - Chicago added that the index accelerated for the fifth straight month, a trend not seen since 2002. The increase by the headline index came in spite of a slowdown in the pace of production and new orders growth, with the production index slipping to 65.2 in February from 66.6 in January, while the new orders index fell to 62.2 from 66.4 in the previous month. The report also showed an acceleration in the pace of contraction in inventories, as the inventories index fell to 42.4 in February from 48.7 in January. "Bottom line, the data confirms that manufacturing remains the source of our incipient recovery," said Peter Boockvar, equity strategist for Miller Tabak. "While some key components fell from January, they jumped from December." With regard to inflation, the ISM - Chicago said the prices paid index rose to 67.7 in February from 66.2 in January, indicating a modest acceleration in the pace of price growth. James Knightley, an economist at ING Financial Markets, noted, "In terms of the broader situation, today's figures follow other regional surveys such as the NY Empire, which rose to 24.9 from 15.9, and the Philadelphia Fed (rose to 17.6 from 15.2)." "All in all this actually bodes well for the national ISM manufacturing report, due Monday," Knigthley added. Next Monday, the Institute for Supply Management is due to release its national report on manufacturing activity in the month of February, with the index of activity in the sector expected to edge down to 58.0 from 58.4 in January.
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