June Midwest index signals above-average growth: Chicago Fed
The June Midwest Economy Index slipped to 0.40 from an upwardly revised 0.58 in May, first reported as 0.51, the Federal Reserve Bank of Chicago said Friday.
The relative MEI soared to positive 0.01 from a downwardly revised negative 0.37 in May, first reported as negative 0.31.
All states in the region were positive in the month, indicating above-average growth.
Manufacturing added 0.35 to the index, after contributing 0.44 to the index in May, while adding 0.24 to the relative MEI, after a 0.01 contribution in May.
Construction and mining added 0.01 in the month, after a 0.08 contribution in May, while contributing 0.02 to relative MEI index after a 0.06 addition in May.
The service sector MEI subtracted 0.07 after a 0.04 subtraction in the prior month, while subtracting 0.30 from relative MEI after a 0.44 subtraction in May.
Consumer spending added 0.10 to MEI, after a 0.10 contribution in May, while contributing 0.04 in June, after a neutral contribution the prior month.
By state, Illinois added 0.14 in June, Wisconsin contributed 0.09, Iowa added 0.08, Michigan contributed 0.07, and Indiana contributed 0.01.
The index is a weighted average of 129 state and regional indicators encompassing the five states in the Seventh Federal Reserve District (Illinois, Indiana, Iowa, Michigan, and Wisconsin). The index measures growth in nonfarm business activity.
A zero value for the MEI indicates that the Midwest economy is expanding at its historical trend rate of growth; negative values are associated with below-trend growth while positive values indicate above-trend growth. A zero value for the relative MEI indicates that the Midwest economy is growing at a rate historically consistent with the growth of the national economy; positive values indicate above-average relative growth; and negative values indicate below-average relative growth.