The MNI Chicago Business Barometer softened in March to 58.7, bringing the Q1 average to 60.0, its lowest quarterly reading in two years.
Although the barometer has comfortably remained above the 50 neutral level for more than two years now, survey evidence points to a slight slowdown since last year.
Inflationary pressures eased, as indicated by the prices paid indicator showing the biggest monthly fall in 17 months. This is in line with U.S. producer prices, which grew at a meagre rate of 0.1% month over month in February following three months of decline.
Unfulfilled orders shrank significantly in March, diving into contraction territory for the first time since January 2017, recording the largest monthly decline in the history of the survey.
This month's special question asked firms about their forecast for new orders in Q2.
A total 46.8% firms expected orders to increase in Q2 while 14.8% saw their orders plummet. Optimism has waned this year, with companies less bullish now than when the same question was posed in 2017 and 2018.
