Chicago, IL, December--A gauge of business activity rebounded from the first contraction in more than three years as orders and production increased, according to a Chicago-based purchasing managers' group.
The National Association of Purchasing Management-Chicago said today its business barometer advanced to 52.4 this month from 49.9 in November, which was the lowest since April 2003. A reading lower than 50 signals contraction.
Exports and investment in new equipment are keeping factories busy, limiting the drag on the economy from a downturn in the auto and housing industries. The report backs forecasts from some economists that the slowdown in growth may not deepen in 2007.
Economists had expected the index to rise to 50.0.
The Chicago group surveys companies with U.S. and worldwide operations. Any group member, even those not located in the Midwest, can respond. For that reason, some economists watch the Chicago index for an early reading on the outlook for U.S. manufacturing, which accounts for 12 percent of the economy.
