Collapsing Chicago Factory Gauge Brings Out The Recession Calls

If you thought last month's Chicago PMI was bad, suffice to say you'll be absolutely aghast at the July print. A month ago, MNI's Chicago gauge sank to 49.7 from 54.2, in the process handing the US its first contraction-territory business indicator. Fast forward four weeks and the latest read on the gauge is 44.4, a grievous miss versus consensus (51) and 5 handles below the most pessimistic estimate from two-dozen economists surveyed. This, frankly, is a catastrophe: The breakdown isn't fu

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5 thoughts on “Collapsing Chicago Factory Gauge Brings Out The Recession Calls

  1. The dichotomy between consumer-related indicators and manufacturing/trade/transport-related indicators is striking. Most of the former are positive and/or improving/stable: consumer spending, unemployment, wage inflation, confidence, etc. Most of the latter are negative and/or deteriorating: PMI, freight loadings, capital spending, inventories, etc. It would be interesting to see how often these two aspects of the economy diverge and the implications.

    1. Isn’t the dichotomy you note just a reflection of the decades-long evolution of the U.S. economy from an industrial manufacturing economy to a services/knowledge economy?

    2. I for a long time have had misgivings over the facts and the intended perceptions that has created this scenario that seems unable to resolve itself.
      H….. speaks to this in so many of his posts but the approach is coming from a different angle and a different background….Levels of desperation in the system are dictating eventual outcomes that for hundreds if not thousands of years have repeated themselves.. The only things that are different are the tools in our toolbox and man’s potential to obscure what used to be reality.

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