The Midwest Economy Index dipped to 0.22 in October from 0.34 in September, the Federal Reserve Bank of Chicago reported Friday.
The relative MEI dropped to 0.19 in October from 0.62 in September. The positive relative MEI indicates that growth in the region was higher than expected.
Manufacturing contributed 0.19 to the index in October, after a 0.07 addition in September, while adding 0.19 from the relative MEI, after a 0.06 contribution in September.
Construction and mining took 0.05 from MEI in the month, after subtracting 0.04 in September, while subtracting 0.01 from relative MEI in October after adding 0.02 to the index in September.
The service sector added 0.04 to MEI in October after contributing 0.29 the prior month, while contributing 0.03 to relative MEI after adding 0.55 in September.
Consumer spending contributed 0.03 to MEI, after adding 0.02 in September, while subtracting 0.01 from relative MEI, after a 0.02 subtraction in September.
By state, Wisconsin made the largest contribution in October, 0.12, with Michigan contributing 0.10, and Illinois adding 0.05.Indiana took away 0.01, and Iowa subtracted 0.04.
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.