The Chicago Business Barometer eased slightly in June but remained at a high level, pointing to a rebound in GDP growth in the second quarter following a sharp fall in the first quarter. While new orders fell from a seven-month high, production rose firmly above 70, close to its level in April. The strength in production and new orders underpinned the Barometer during the second quarter. Some respondents indicated they built inventories ahead of a possible strike by longshoremen at ports. The chief economist commented that while growth in the first half of the year will be slower than initially expected, upcoming data in the third quarter will be important in determining the timing of the first interest rate hike.

1. Embargoed until 9:45 A.M. E.T., 30 June 2014
Media Release
Chicago Business Barometer Down 2.9 to 62.6 in June
Barometer Points to GDP Rebound in Q2
New Orders Expand at Slower Rate while Production Surges Above 70
The Chicago Business Barometer eased to 62.6 in
June, from a seven month high of 65.5 in May, but
was still up sharply on the quarter and consistent
with a bounceback in Q2 GDP.
The Barometer was up considerably from 52.0 a year
ago, marking the fourteenth consecutive monthly
expansion, and the third month in a row above 60.
The bounceback in Q2 to a solid average of 63.7 from
58.4 in Q1, was the highest level for three years and
points to a rebound in GDP growth in the second
quarter following the sharp fall in Q1.
The Barometer’s strength during Q2 was underpinned
by strong rises in both New Orders and Production.
In June, a fall in New Orders from a seven month high
in May led the Barometer’s decline, although it
remained well above the 50 mark, confirming
continued strong demand. Order Backlogs also
weighed negatively on business activity and declined
from May’s three year high. While both components
contributed negatively to the Barometer in June,
they remained well above their 10 year averages.
Production rose firmly above 70 in June, close to
April’s level, and ended at an average of 68.3 in the
three months to June, nearly eight points above Q1.
Increased output led to a gain in the Employment
Indicator to a four month high. A lengthening in
Supplier Deliveries also supported the Barometer in
June, but weighed negatively on business.
Latest GDP data showed that a drawdown in stocks
hit growth in Q1. Our Inventories Indicator, though,
posted a third consecutive monthly increase to the
highest since November, as firms rebuilt stocks.
Some respondents said they built inventories ahead
of a possible strike by longshoremen at ports.
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Media Relations
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Chicago Business BarometerTM
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Editorial content:
Philip Uglow,
Chief Economist, MNI Indicators
Alyce Andres-Frantz
Chicago Bureau Chief, MNI News
Commenting on the MNI Chicago Report, Philip
Uglow, Chief Economist at MNI Indicators said, “The
Business Barometer shows activity slowing a little
between May and June, but it remains at a high level
supported by the strength in Production and New
Orders.”
“The downward revision to GDP in the first quarter
was far larger than expected, and while the data now
look a little historic, and the Chicago Report points
to a bounceback in Q2, it does mean growth will be
slower over the first half of the year than first
thought. The Q3 data cycle, not least our own
Barometer, will be critical in terms of determining
the timing of the first hike in rates,” he added.

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About MNI Indicators
MNI Indicators specialises in producing business and consumer surveys designed to present an advance picture of the economic landscape and
highlight changing trends in business and consumer activity. The timely reports explore attitudes, perspectives and sentiment across the globe,
including China, India and Russia. Alongside MNI Indicators’ core focus on consumer and business surveys in emerging markets, MNI Indicators
produces the renowned Chicago Business Barometer (Chicago PMI), a key leading indicator of the US economy. MNI Indicators is part of MNI, a leading
provider of news and intelligence, a wholly owned subsidiary of Deutsche Börse AG, and one of the largest worldwide exchange organisations.
About ISM-Chicago
ISM-Chicago is a non-profit association dedicated to strengthening the community of purchasing and supply management professionals in the Chicagoland
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Notes to Editors
Please source all information to MNI Indicators.
The MNI Chicago Report is published by MNI Indicators, part of Deutsche Börse Group, in partnership with the ISM-Chicago.
The MNI Chicago Report is published monthly and contains the Chicago Business BarometerTM
and a number of other Business Activity and Buying Policy
indicators. The data is seasonally adjusted.
The Chicago Business BarometerTM
is a closely watched leading indicator of U.S. economic activity and is based on a survey panel of purchasing/supply-
chain professionals, primarily drawn from membership of the Institute for Supply Management-Chicago (ISM-Chicago). The survey panel contains both
manufacturing and non-manufacturing firms, many with global operations.
The Chicago Business BarometerTM
is a composite diffusion indicator made up of the Production, New Orders, Order Backlogs, Employment and Supplier
Deliveries indicators and is designed to predict future changes in gross domestic product (GDP).
An indicator reading above 50 indicates expansion compared with a month earlier while below 50 indicates contraction. A result of 50 is neutral. The
farther an indicator is above or below 50, the greater or smaller the rate of change.