The Midwest Economy Index slipped to negative 0.12 in July from an upwardly revised neutral level in June, first reported as negative 0.02, the Federal Reserve Bank of Chicago said Monday.
The relative MEI dropped to negative 0.08 in July from an upwardly revised positive 0.12 in June, first reported as positive 0.09. The relative MEI indicates that growth in the region was slightly lower than what would be expected based on national economic growth.
Manufacturing contributed 0.01 to the index, after a 0.03 addition in June, while adding 0.06 to the relative MEI, after a 0.10 addition in June.
Construction and mining removed 0.14 in the month, after a 0.09 subtraction in June, while taking 0.08 from the relative MEI index in July after adding 0.01 to the index in June.
The service sector subtracted 0.01 from MEI in after subtracting 0.02 the prior month, while deleting 0.02 from relative MEI after adding 0.04 in June.
Consumer spending added 0.02 to MEI, after adding 0.06 in June, while subtracting 0.04 from relative MEI, after a 0.03 subtraction in June.
By state, Michigan made the largest contribution in July, 0.13, with Indiana contributing 0.05. Iowa subtracted 0.05, while Illinois deleted 0.07, and Wisconsin subtracted 0.20.
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.
