Investing.com - Manufacturing activity in the Chicago-area returned to expansion in June at its highest level in over a year, coming in well-above forecasts, boosting optimism over the U.S. economic outlook, industry data showed on Thursday.
In a report, the Institute for Supply Management (ISM) said its Chicago purchasing managers’ index increased by 7.5 points to a seasonally adjusted 56.8 this month from a reading of 49.3 in May. That was its highest level since January 2015, thanks to strong gains in new orders and production.
Analysts had expected the index to rise 1.4 points to 50.7 in June.
On the index, a number above 50.0 indicates an expansion, while below indicates contraction.
The report showed that new orders increased sharply on the month to the highest since October 2014, while order backlogs rose to the highest since March 2011, breaking a 16-month run of below 50 readings.
Production also increased significantly to the highest since January 2016.
However, June’s rebound was just enough to offset the previous two months of weakness, leaving the barometer broadly unchanged over the quarter at an average of 52.2 in Q2 compared with 52.3 in Q1.
“Looking at the three-month average provides a better guide this month to the underlying trend in the economy with activity broadly unchanged between Q1 and Q2, said MNI Indicators chief economist Philip Uglow.
“Still, on a trend basis activity over the past four months is running above the very low levels seen around the turn of the year,” he added.
EUR/USD was trading at 1.1112 from around 1.1099 ahead of the release of the data, GBP/USD was at 1.3439 from 1.3409 earlier, while USD/JPY was at 102.78 from 102.83 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 95.80 from 95.91 previously.
Meanwhile, U.S. stock markets were slightly mixed after the open. The Dow 30 rose 0.11%, the S&P 500 inched down 0.03%, while the Nasdaq Composite slipped 0.06%.
Elsewhere, in the commodities market, gold futures traded at $1,323.55 a troy ounce, compared to $1,322.75 ahead of the data, while crude oil traded at $48.62 a barrel from $48.68 earlier.