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Chicago Fed Midwest Manufacturing Index suggests slower growth in February
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The Midwest Economy Index (MEI), which approximates quarterly growth at a monthly frequency, fell to +0.35 in February from +0.65 in January. Contributions to the February MEI from three of the four broad sectors of nonfarm business activity and four of the five Seventh Federal Reserve District states decreased from January. The relative MEI moved down to +0.62 in February from +0.91 in January. Contributions to the February relative MEI from two of the four sectors and three of the five states decreased from January.
The manufacturing sector’s contribution to the MEI edged down to +0.25 in February from +0.27 in January. The pace of manufacturing activity decreased in Iowa and Wisconsin, but increased in Illinois and was unchanged in Indiana and Michigan. Manufacturing’s contribution to the relative MEI moved up to +0.52 in February from +0.40 in January.
The construction and mining sector contributed +0.01 to the MEI in February, down from +0.16 in January. The pace of construction and mining activity was slower in all five states. Construction and mining’s contribution to the relative MEI fell to +0.01 in February from +0.24 in January.
The service sector’s contribution to the MEI moved up to +0.07 in February from –0.01 in January. The pace of service sector activity was up in Illinois, Michigan, and Wisconsin, but down in Iowa and unchanged in Indiana. The service sector’s contribution to the relative MEI moved up to +0.03 in February from –0.06 in January.
Consumer spending indicators contributed +0.03 to the MEI in February, down from +0.23 in January. Consumer spending indicators were, on balance, down in all five states. Consumer spending’s contribution to the relative MEI fell to +0.06 in February from +0.33 in January.
Posted: March 31, 2021 Wednesday 08:30 AM