By Joshua Kirby

Business activity slumped in the Chicago area in December, largely wiping out the previous month's unexpected rise, according to a purchasing managers' index for the region.

The Chicago Business Barometer fell to 46.9 from 55.8 in November, data from a survey compiled by MNI indicators showed Friday. The reading marks a notably sharper fall than the slide to 50.0 expected by economists in a poll carried out by The Wall Street Journal.

The index had surged in November, a rise mostly erased by this month's fall, though the index remains a little above the point it reached in October and in September.

The barometer is compiled through surveys of firms in the Chicago area in order to assess business conditions and components including new orders, order backlogs, production, supplier deliveries and employment.

All main components of the index declined in December. Production fell back, though it remained in expansion territory, but order backlogs crashed by more than 13 points to reach its third lowest point in around three years, MNI said. New orders and inventories similarly fell.

With activity cooling, the employment index also fell by nearly nine points, returning to contraction after two months of expansion.

Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby

(END) Dow Jones Newswires

December 29, 2023 10:14 ET (15:14 GMT)