Chicago manufacturing downturn deepens in January

The manufacturing downturn in the wider Chicago area unexpectedly worsened in January, according to a closely watched survey of purchasing managers released on Wednesday.

The purchasing managers' index (PMI) released by the Institute for Supply Management-Chicago, which tracks business conditions across Illinois, Indiana and Michigan, dropped to 46.0 this month, from a revised 47.2 in December.

A move further away from the neutral 50-point level indicates that a contraction in business activity had deepened, and will have surprised economists who had pencilled in a slight uptick to 48.0.

The index had jumped to 55 in November, moving into positive territory for the first time in 15 months, but dropped sharply in December.

The Chicago PMI is one of the six widely followed regional manufacturing surveys – the others being from New York, Richmond, Dallas, Kansas and Philadelphia – that help predict economic activity nationwide.