Chi Fed Midwest Manufacturing Index At 15-Year Low On Car Output Nosedive
18 März 2009 - 5:43PM
Dow Jones News
Plagued by a near-bankrupt U.S. auto industry, manufacturing
activity in the Midwestern U.S. plunged to a nearly 15-year low in
January, data from the Federal Reserve Bank of Chicago revealed
Wednesday.
The Chicago Fed Midwest Manufacturing index dropped 5.9% in
January to a seasonally adjusted level of 85.6. That's the lowest
reading since July 1994, the Chicago Fed reported.
Data compilers also revised downward its December index to 91.0,
from their initial estimate of 92.2.
The regional index was down 21.8% from January 2008, falling at
a faster clip than the 13.0% decline felt nationwide.
The same index was also weaker than the Federal Reserve Board's
industrial production index for manufacturing, which declined 2.6%
in January.
The auto sector was by far the weakest of the four components
that make up the manufacturing index.
The five-state Midwest region includes Michigan, which is home
to the nation's largest auto manufacturers. President Barack
Obama's auto task force is looking at ways outside of bankruptcy
court to restructure severely struggling General Motors Corp. (GM)
and Chrysler LLC.
The auto sector index tumbled 20.0% in January on the heels of
only a 1.8% decline in December. The January index reading of 49.5
was the lowest since August 1991, according to the Chicago Fed.
Compared to year-ago levels, regional output was down 42.2%,
versus a 24.3% decline nationwide. In January alone, national auto
output fell 10.1%, a much slower contraction than was experienced
on a regional basis.
In addition to Michigan, the index encompasses Illinois,
Indiana, Iowa and Wisconsin.
The Chicago Fed counts the number of hours worked to measure
changes in regional activity.
The Chicago Fed is scheduled to release its February index April
6.
-By Howard Packowitz, Dow Jones Newswires; 312-750-4132;
howard.packowitz@dowjones.com