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Manufacturing activity in the Midwest declined in August for the first time since
its recovery began in March. The August decline was modest (down 0.6% from
the previous month), compared to the monthly gains experienced in recent
months. However, that decline was in marked contrast to the continued gains in
manufacturing activity nationwide.
The softness in the Midwest was concentrated in the transportation and chemicals
sectors of the region’s economy, which were also weak nationally. Declines in
the Midwest’s chemicals sector were roughly in line with weakness nationally,
but the decline in the transportation sector was substantially deeper than for the
nation as a whole.
NOTE: The MMI and the USMI are composite
indexes of 17 manufacturing industries and are
derived from econometric models that estimate
output from monthly hours worked and
kilowatt hours data. For a discussion of the
methodology, see “Reconsidering the Regional
Manufacturing Indexes,” Economic Perspectives,
Federal Reserve Bank of Chicago, Vol. XIII,
No. 4, July/August 1989.
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