NEW YORK – The Midwest Economy Index rose to positive 0.83 in April from positive 0.79 in March, according to the Federal Reserve Bank of Chicago, as gains in the manufacturing sector helped pull the index to its highest level since March 1995.
The Midwest was outperforming the nation as a whole, the Fed said, as the relative MEI posted a positive 1.06 reading in April, up from positive 0.81 reading in March.
Manufacturing contributed positive 0.73 to the index in April, after a positive 0.63 gain in March, while contributing positive 0.88 to the relative MEI, up from positive 0.70 in March.
Construction and mining contributed negative 0.21 in April, after negative 0.19 in March to MEI, and for relative MEI the sector subtracted 0.12 after subtracting 0.09 in March.
The service sector added 0.14 to MEI in April after contributing 0.15 in March, while contributing positive 0.25 to relative MEI in April after positive 0.21 in March.
Consumer spending added 0.17 to MEI in April, up from positive 0.20 in March, while contributing positive 0.04 to relative MEI in April after negative 0.01 in March.
By state, Michigan showed the strongest growth, followed by Illinois, Wisconsin, Indiana and Iowa.
The index is a weighted average of 128 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.
