The MNI Chicago Business Barometer printed 62.7 in May 2026, its highest reading in four years and a 13.5-point surge from April’s 49.2, which had marked a return to contraction. The consensus forecast heading into the release was 50.3 to 50.6, making the miss one of the largest in recent memory. For context, the index spent 25 consecutive months below the neutral 50 threshold from late 2023 through the end of 2025, averaging just 42.3 for the full year of 2025. The January 2026 reading of 54.0 marked the first expansion in that stretch, and the index climbed to 57.7 in February before easing to 52.8 in March and slipping back to 49.2 in April. The May reading represents the highest single-month print since 2022.
The Barometer is a weighted composite diffusion index built from five sub-indicators: New Orders, Production, Employment, Order Backlogs, and Supplier Deliveries. It is produced monthly by MNI Indicators in partnership with ISM Chicago, drawing on surveys of purchasing and supply management professionals across the Chicago region. Readings above 50 indicate expansion; readings below 50 indicate contraction. The index has been published for more than 70 years and is released on the last working day of each month. Its sub-indices, particularly New Orders, Production, Employment, and Prices Paid, have shown consistent statistical relationships with their corresponding national economic measures, including official U.S. GDP data.
That GDP correlation is why the Chicago PMI receives attention well beyond the Chicago metropolitan area. It is historically regarded as a leading indicator for the national ISM Manufacturing PMI, one of the most closely watched monthly economic releases in the United States. When the Chicago index moves sharply in one direction, national manufacturing data have frequently followed in subsequent months. April’s contraction reading of 49.2 had reinforced concerns about economic softness heading into the second half of 2026, particularly given that order backlogs fell 11.4 points and new orders dropped 6.5 points in that month alone. The May reversal erases much of that concern, at least for now.
The magnitude of the May swing is historically significant. A 13.5-point monthly gain ranks among the largest in the series’ recent history, comparable in scale to post-disruption rebounds in 2020. Prices Paid, a sub-index that climbed to its highest level since June 2025 in April amid concerns over oil, metals, and transportation fuel surcharges, will be worth watching in the June release to assess whether the demand surge is feeding inflation pressure. The index has now recovered from a 2025 low of 36.3 in November to 62.7 in May, a gain of 26.4 points over six months. Whether that trajectory holds will be a key signal for the health of U.S. manufacturing and broader economic activity through the second half of the year.
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