Investing.com - Manufacturing activity in the Chicago-area fell more than expected in August, dampening optimism over the U.S. economic outlook, industry data showed on Wednesday.
In a report, the Institute for Supply Management (ISM) said its Chicago purchasing managers’ index decreased by 4.3 points to a seasonally adjusted 51.5 this month from a reading of 55.8 in July. Analysts had expected the index to drop 1.8 points to 54.0 in July.
On the index, a number above 50.0 indicates an expansion, while below indicates contraction.
The ISM indicated that four of the five Barometer components fell between July and August and the drop in the overall indicator was led by a large setback in Order Backlogs, heading back into contraction, and a deceleration in New Orders.
Although in a positive sign, Employment increased, hitting a 16-month high.
“Economic activity slowed down into the summer, suggesting June’s momentum was only a temporary revival in activity,” said Lorena Castellanos, senior economist at MNI Indicators that helps elaborate the data.
“Overall, it wasn’t a rosy month,” Castellanos noted, although she pointed out that the trend in July through August growth rates were less weak than the one seen earlier in the year.
After the report, EUR/USD was trading at 1.1141 from around 1.1130 ahead of the release of the data, GBP/USD was at 1.3090 from 1.3085 earlier, while USD/JPY was at 103.34 from 103.45 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 96.12 from 96.21 previously.
Meanwhile, U.S. stock markets were lower after the open. The Dow 30 lost 0.17%, the S&P 500 fell 0.15%, while the Nasdaq Composite traded down 0.16%.
Elsewhere, in the commodities market, gold futures traded at $1,313.15 a troy ounce, compared to $1,310.85 ahead of the data, while crude oil traded at $46.05 a barrel from $45.89 earlier.