The Midwest Economy Index narrowed to negative 0.14 in October from a downwardly revised negative 0.17 in September, first reported as negative 0.15, the Federal Reserve Bank of Chicago said Wednesday.
The relative MEI climbed to negative 0.23 in October from a downwardly revised negative 0.34 in September, first reported as negative 0.29. The relative MEI indicates that growth in the region was somewhat lower than what would be expected based on national economic growth.
Manufacturing subtracted 0.08 to the index, after a 0.07 subtraction in September, while subtracting 0.10 from the relative MEI, after a 0.06 subtraction in September.
Construction and mining removed 0.10 in the month, after a 0.14 subtraction in September, while taking 0.08 from the relative MEI index in October after subtracting 0.15 from the index in September.
The service sector took 0.05 from MEI in October after a neutral reading the prior month, while deleting 0.12 from relative MEI after a 0.15 subtraction in September.
Consumer spending added 0.09 to MEI, after adding 0.04 in September, while contributing 0.07 to relative MEI, after a 0.01 addition in September.
By state, Michigan made the largest contribution in October, 0.03, with Indiana subtracting 0.03, while Illinois deleted 0.03, Wisconsin subtracted 0.05, and Iowa subtracted 0.07.
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.
