The Midwest Economy Index fell to negative 0.14 in July from negative 0.04 in June, the Federal Reserve Bank of Chicago said Wednesday.
The relative MEI slid to 0.33 from 0.38 in June. The relative MEI indicates that growth in the region was quite close to what would be expected based on national economic growth.
Manufacturing subtracted 0.04 from the index, after a neutral contribution in June, while adding 0.12 to the relative MEI, after a 0.21 contribution in June.
Construction and mining subtracted 0.09 in the month, after a 0.04 subtraction in June, while taking 0.03 from the relative MEI index in June after adding 0.08 to the index in June.
The service sector took 0.04 from MEI in July after a 0.05 subtraction the prior month, while subtracting 0.08 from relative MEI after a 0.02 contribution in June.
Consumer spending added 0.03 to MEI, after adding 0.05 in June, while contributing 0.02 to relative MEI, after a 0.06 addition in June.
By state, Michigan and Illinois made the largest contributions in July, each adding 0.02, while Wisconsin subtracted 0.01 from the index, Indiana deleted 0.07 and Iowa subtracted 0.10.
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.
