Chicago PMI

Who: Chicago arm of the National Association of Purchasing Managers

When: Last day of the month for the current month

What: The Chicago PMI is measured by new orders, production, supplier deliveries, inventories and employment; asking for positive, negative or unchanged readings of each. A reading above 50% generally indicates that the manufacturing sector is expanding, and below 50% signifies contraction. The Chicago Purchasing Managers Index is measured like the ISM (Institute for Supply Management) and has a 91% correlation with the national ISM.

Why: Manufacturing is an important sector of the economy and the Chicago PMI is one of the two primary national measures (the ISM is the other). It is looked at as a good indicator for future inflationary pressures and can have a big effect on the markets. Changes in prices paid by manufacturers can be indicative of accelerating or decelerating inflation and future manufacturing activity can be predicted by changes in new orders. Strength in the manufacturing sector may be a sign of a strong economy and is usually negative for bond markets.