Chicago PMI Rebounds, But Signals Economic Contraction For 8th Straight Month

After January’s unexpected plunge to multi-year lows, Chicago PMI rebounded in February (from 42.9 to 49.0), beating expectations of 46.0.

This is the eighth straight month of contraction (sub-50) for Chicago’s Business Barometer…

Source: Bloomberg

As the chart above shows, the soft survey picture cross regional surveys is extremely mixed to say the least.

5 components of the Chicago PMI rose vs last month:

• Prices paid rose at a slower pace, signaling expansion

• New orders fell at a slower pace, signaling contraction

• Employment fell at a faster pace, signaling contraction

• Inventories fell at a slower pace, signaling contraction

• Supplier deliveries rose at a faster pace, signaling expansion

• Production rose and the direction reversed, signaling expansion

• Order backlogs fell at a slower pace, signaling contraction

Once again we remind readers that this number is entirely irrelevant as it hit before the impact of Covid-19 and the stock market collapse.