Chicago PMI drops into contraction territory in June
MIN's Chicago purchasing managers' index fell into contraction territory in June for the first time in more than two years, according to figures released on Friday.
The Chicago business barometer declined to 49.7 this month from 54.2 in May, missing expectations for a reading of 53.1 and marking the first sub-50 reading since January 2017. A reading below 50 indicates contraction, while a reading above signals expansion.
The survey found that 80% of firms said they were negatively affected by government-imposed tariffs on their business, with tariffs raising prices of their goods leading to a pullback in orders.
Shaily Mittal, senior economist at MNI Indicators, said: "With customers rethinking their purchases, demand tumbled, and consequently firms pulled back production, weakening overall business sentiment.
"In coming months, our survey will provide further evidence as to whether the diminished business confidence is temporary amid tariffs woes or more structural calling for some counter measures."