2023.03.3115:01:00UTC+00Chicago Business Barometer Unexpectedly Inches Higher In March

MNI Indicators released a report on Friday showing its reading on Chicago-area business activity unexpectedly increased in the month of March.

The report said the Chicago business barometer inched up to 43.8 in March from 43.6 in February, although a reading below 50 still indicates a contraction. Economists had expected the index to edge down to 43.4.

The unexpected uptick by the headline index partly reflected a rebound by the production index, which rose by 2.6 points in March after tumbling by 10.2 points in February.

MNI Indicators said the employment index also increased by 5.4 points, moving to similar levels seen in both December and January.

The report also said the inventories index jumped by 13.6 points in March, re-entering expansive territory and returning to November levels.

Meanwhile, the new orders edged down by 1.0 points, with some firms seeing a small pick-up whilst others noted a slowdown due to clients' inflated orders over earlier months.

The supplier deliveries index slumped by 9.3 points during the month, falling below 50 for the first time since June 2016, as some respondents found substantial improvements in deliveries as supply chain pressures ease further.

On the inflation front, the prices paid index edged up by 0.3 points after a substantial February deceleration, with just below half of respondents continuing to see prices increase in March.