Chicago PMI print falls in July, activity likely to accelerate in future

The Chicago PMI dropped in July, coming in line with expectations. The PMI dropped to 58.9 in July, as compared with consensus expectations of 60. They survey had reached its highest level since 2011 in June and the index is expected to pare back some of the rise in July. On an ISM-adjusted basis, the Chicago PMI continues to be at a fairly strong print of 58.

Looking at the report’s details, the production diffusion index dropped to 60.8 and new orders dropped to 60.3, both pretty solid drops. The employment index dropped to 52.6 from 56.6; however, it continues to be at strong levels compared to the sub-50 print seen in April.

Overall, today’s report implies that manufacturing confidence within the region continues to be strong and in expansionary territory, although the index has dropped lower relative to levels seen earlier in the year, stated Barclays in a research report. The modest retracement in sentiment in the Chicago PMI is in line with other regional PMI and business sentiment survey data. Overall, activity is expected to accelerate and to keep the economy on its modest growth path, added Barclays.

At 22:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was bearish at -71.0008. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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