Chicago PMI Falls in May

By Austen HuffordFeaturesDow Jones Newswires

A reading for business activity across the Midwest fell in May but remained in expansion territory, according to a report Wednesday.

The Chicago Business Barometer, also known as the Chicago PMI, slid to 55.2 in May from 58.3 in April. Still, the index remained above the 50 mark, which separates expansion from contraction.

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Economists surveyed by The Wall Street Journal expected the gauge to come in at 56.5.

May's decline "needs to be viewed in the context of the strength seen in the past three months," said Shaily Mittal, senior economist at MNI Indicators. "Still, business activity over the past three months is running significantly above the levels seen during the same time last year."

The employment indicator remained in positive territory during the month as a rise in temporary hires offset a drop in executive level positions.

A majority of respondents planned on hiring over the next three months, suggesting optimism about summer demand.

The Chicago reading is one of several monthly regional surveys that can gauge the health of U.S. production. The Chicago report is slightly different from the others in that it includes some firms from the bigger and better-faring service sector and because it isn't conducted by a Federal Reserve bank. The index is known to be a volatile one, in part because it is influenced by swings in Boeing Co. orders.

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(END) Dow Jones Newswires

May 31, 2017 11:01 ET (15:01 GMT)