Growth in Chicago-area business activity slowed by much more than anticipated in the month of February, according to a report released by MNI Indicators on Wednesday.
MNI Indicators said its Chicago Business Barometer dropped to 61.9 in February from 65.7 in January. While a reading above 50 still indicates growth, economists had expected the index to show a more modest drop to 64.2.
With the much bigger than expected decrease, the Chicago business barometer fell to its lowest level since August of last year.
The steep drop by the business barometer was primarily due to a continued slowdown in new orders growth, as the new orders index fell to a six-month low.
The production index also showed a continued decrease in February, falling to a level last seen lower in September.
Despite trending lower recently, MNI Indicators noted both indicators remain elevated relative to recent years.
The report said hiring intentions also eased in February, with the employment index edging down from the nearly six-year high set in January.
On in the inflation front, input price inflationary pressures remained elevated in February despite receding from January’s four-month high.
“A large proportion of firms are anxious about the cost of input materials, and warn they could pass on these higher costs to consumers if inflationary pressures do not abate,” said Jamie Satchi, Economist at MNI Indicators.