Mixed news on Midwest manufacturing arrived today, courtesy of the Federal Reserve Bank of Chicago.
It reported that the Midwest Economy Index, a weighted average of 128 state and regional indicators, reached its highest level in 16 years. In April, the index climbed to +0.83, its best mo nthsince March 1995 and up from +0.79 in March. April marked the seventh consecutive month the marker finished above its historical trend.
Manufacturing activity led that growth. It added +0.73 to the MEI, the sector’s largest contribution since January of 1984. Iowa, Michigan and Wisconsin all gained manufacturing activity in April, while the sector held steady in Illinois and Indiana. (The Seventh Federal Reserve District does not include Ohio).
But the overall pace of growth slowed from the previous month. The index had climbed to +0.79 in March from +0.39 in February. And, in a separate release, the Fed said its Midwest Manufacturing Index showed a 0.9 decrease in output to a seasonally adjusted level of 83.6 percent.
The automotive sector led the decline, falling 5 percent in April. The loss was widely attributed to supply disruptions caused by earthquake, tsunami and nuclear fallout in Japan. One month earlier, automotive sector output had risen 3.3 percent.