NEW YORK (MaceNews) – Manufacturing business conditions eroded in the Chicago region in July/August while non-manufacturing improved, according to the latest survey of Seventh Federal Reserve district business activity conducted by the Chicago Fed.
The Chicago Fed’s Survey of Business Conditions Activity Index rose to −22 in the July/August survey period from −30 in the prior period, but the sub-zero diffusion index suggests that growth was muted at best.
Components of the CFSBC were mixed: the manufacturing subindex declined to −39 from –34, while the non-manufacturing Index rose to –13 from –26.
The Chicago Fed’s CFSBC data series is based on diffusion indexes calculated from the district’s beige book business survey questions compiled ahead of each meeting of the Federal Reserve’s policy-making Federal Open Market Committee, eight times yearly.
“Respondents’ outlooks for the U.S. economy for the next 12 months deteriorated, turning pessimistic on balance,” the Chicago Fed said. “Respondents with pessimistic outlooks highlighted elevated policy uncertainty under the current U.S. presidential administration, particularly in regard to trade policy, and slower demand for their firms’ products. Respondents with optimistic outlooks highlighted good economic data and growing demand for their firms’ products. The pace of current hiring increased, while respondents’ expectations for the pace of hiring over the next 12 months decreased. Both hiring indexes remained negative. The pace of current capital spending decreased, as did respondents’ expectations for the pace of capital spending over the next 12 months. Both capital spending indexes remained negative. The wage cost pressures index moved up, as did the non-wage cost pressures index. Both cost pressures indexes remained negative.”