Economic Report: Chicago PMI shows region’s economy remains hot as 2018 winds down

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The economy in the Chicago region grew a bit slower in December, but the region is still expanding rapidly.

A survey of business conditions in the Chicago area that’s often viewed as a signpost for the broader U.S. economy showed strong, if slightly softer, growth in the final month of 2018.

The MNI Chicago business barometer slipped to 65.4 points in December from an 11-month high of 66.4 in the prior month. That easily beat Wall Street’s expectation for a reading of 62.4, according to Econoday.

Any reading over 50 points to an improving economy and numbers over 60 are considered exceptional.

What happened: Companies continued to produce goods and services at a rapid pace and back orders were the highest since last July, suggesting no deterioration in customer demand.

The Chicago survey gives a good idea of what’s happening with manufacturers and other large U.S. companies, including many with expansive global operations. It is viewed as a leading indicator of how well the U.S. and even global economies are performing.

Big picture: Wall Street has been awfully worried lately: A slowing global economy, rising U.S. interest rates, ongoing trade tensions with China, President Donald Trump’s attacks on the Federal Reserve. But ordinary Americans seem less anxious.

Read: Trump started a fight with the Fed he had zero chance of winning

The Christmas shopping season looks particularly strong, for one thing, and consumer confidence is still quite high despite coming off an 18-year peak. Americans are more anxious about next year, but for now they still see a strong economy as reflected by the lowest unemployment rate in 49 years.

Also read: Recession in 2019? Here’s how to avoid it

Market reaction: The Dow Jones Industrial Average DJIA, +0.01% and S&P 500 SPX, +0.01% rose modestly in early Friday trade, building on a strong rally that began with a huge 1,000-point gain in the Dow two days ago.

Check out: Bridge to nowhere? Some doubts on economy justified, doom and gloom isn’t

The 10-year Treasury yield TMUBMUSD10Y, -1.27% was little changed at 2.75%. Yields have tumbled from a seven-year high of almost 3.25% reached in October.

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