MNI 5 Things: Orders At 21-Mon Low: Oct Chicago Biz Barometer

     LONDON (MNI) - The following are the key points from the October MNI

Chicago Business Barometer:

     - The MNI Chicago Business Barometer fell to a six-month low of 58.4 in

October, down 2.0 points from September, meaning the headline index has now

moderated for three months in a row. Should this trend continue into November,

it would be first time the Barometer has declined for four straight months since

October 2013 (that said, the index overall is in a much healthier position now

compared to then).

     - Order book growth eased for the second straight month in October and,

like the headline index, suggests activity is continuing to cool off after

running hot for much of the past year -- it was the sixth time the New Orders

indicator had lost ground this year. Production, on the other hand, did

strengthen, up marginally after September's 10-point drop.

     - Production continues to be held back by supply chain issues. Wait times

for key materials rose again on the month, with the Supplier Deliveries

indicator at a 14-and-a-half-year high. Firms reiterated concerns that suppliers

are understaffed, both a skilled and unskilled level, holding up their

operations. This month's special question explored this theme, asking firms

whether they thought allocation issues would hamper production in Q4. Though

36.2% of respondents thought this would not be the case, an almost equal share,

31.9%, did foresee difficulties ensuing. The remaining 31.9% were unsure.

     - Employment frustrations were not just isolated to suppliers, however.

Despite being open to hiring, finding workers of a suitable profile remained a

challenge for many organizations. The Employment indicator rose in October, the

first gain since July. There was anecdotal evidence from some firms that they

were shifting priorities to retaining workers.

     - Input price inflation, measured by the Prices Paid indicator, remains

elevated in October, locked in a historically high range. Some firms reported

invoices starting to price in the additional costs from tariffs. Many expected

prices to remain high looking forward, leading to firms stockpiling key items in

order to mitigate against future rises - some did so to as a form of insurance

to keep prices down for the Christmas period.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

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