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To: ~digs who wrote (12028)	12/30/2002 11:33:13 AM
From: Bucky Katt	Respond to of 13094

Is this NAPM number a surprise to anyone but the talking heads?> Chicago, Dec. 30 (Bloomberg) -- An index of Chicago area manufacturing expanded at a slower pace in December, a survey of purchasing executives showed. The National Association of Purchasing Management-Chicago said its factory index fell to 51.3 from 54.3 in November. Readings greater than 50 mean business expanded at the region's factories while lower readings signify contraction. The above-50 reading signals a second consecutive month of improvement in manufacturing. Manufacturers are increasing production to replenish lean inventories and fill orders as demand picks up. Sales are increasing at Glenview, Illinois-based Illinois Tool Works Inc., a maker auto parts and plastic packaging with 400 separate business units. ``Manufacturing is expanding but we're not seeing the sharp recovery we usually get in manufacturing,'' said Brian Wesbury, chief economist with Griffin Kubik Stephens & Thompson in Chicago. The Chicago report adds to evidence that U.S. manufacturers are pulling out of a slump that pushed the Institute for Supply Management's national factory index below 50 for the past three months. Economists expect that index to rise to 50.1 from 49.2 in November when the group's December report is released Thursday, based on the average forecast in a Bloomberg News survey. Investors and analysts watch the Chicago report for clues about the direction of U.S. manufacturing because the region has more factory jobs than any other metropolitan area. Economists expected the purchasing managers' index to fall to 52.8, according to the median of 35 analysts in a Bloomberg News survey. The purchasers' prices-paid index rose to 62.1, the highest since August, from 57.2. Crude oil prices rose more than 20 percent this month after Venezuelan oil workers began a strike aimed at ousting President Hugo Chavez. The index of new orders fell to 53 from 60.8, which was the highest since June. The production index slipped to 54.2 from 57.3 while the index of order backlogs increased to 48.1 from 47.7 last month. Illinois Tool Works said sales rose 4 percent in the three months ended Nov. 30 as demand for products such as fasteners, polymers and electronic-parts packaging increased overseas. The company said decline in the value of the U.S. dollar helped account for half its sales gain. The purchasers' employment index rose to 50.3 from 43.3 in November. The region's factories have been cutting jobs since March 2000, the longest decline in two decades. The inventories index fell to 42.5 from 43.3. Federal Reserve policy makers earlier this month left their benchmark short-term interest rate unchanged at a 40-year low of 1.25 percent amid signs the economy may be ``working its way through its current soft spot.''