Chicago PMI reverses recent gains in November

The Chicago PMI fell to 48.7 in November, fully reversing the October surge against the forecast and consensus expectations of a modest decline. The November decline was driven by production (50.9, previous: 63.4) and new orders (44.1, previous: 59.4), both of which fell sharply on the month.

The inventories index (48.3, previous: 60.5) fell below neutral for the first time since June. In contrast, the employment index (51.6, previous: 50.6) registered a modest improvement this month. The remaining components that feed into the headline index were little-changed in November.

"The Chicago PMI, formerly a reliable leading indicator of the national ISM indices, has experience heightened volatility this year. While the negative reading in November suggests sluggish Chicago-area activity, we do not see this print as necessarily indicative of a national slowdown "says Barclays.