The Midwest Economy Index improved to 0.27 in February from 0.01 in January, the Federal Reserve Bank of Chicago said Friday.
The relative MEI grew to positive 0.08 from negative 0.09 in January. The relative MEI indicates that growth in the region was slightly higher than what would be expected based on national economic growth.
Manufacturing added 0.11 to the index, after contributing 0.02 to the index in January, while adding 0.06 to the relative MEI, after a 0.09 contribution in January.
Construction and mining added 0.06 in the month, after a 0.02 subtraction in January, while the relative MEI index added 0.06 after a 0.03 subtraction in January.
The service sector MEI added 0.04 after a neutral reading the prior month, while subtracting 0.10 from relative MEI after taking 0.15 from the index in January.
Consumer spending added 0.05 to MEI, after a 0.01 addition in January, while contributing 0.05 to relative MEI after a 0.01 addition the prior month.
By state, Wisconsin made the largest contribution in February, adding 0.12 to the index, Michigan contributed 0.10, Iowa added 0.02 and Indiana and Illinois each contributed 0.01 to the index.
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.
