CHICAGO (AP) - Chicago's National Association of Purchasing Management said Monday its index of area business activity rose to 57.9 in July on a seasonally adjusted basis from 56.5 in June.
In June, the index fell to 56.5 from 61.5 in May.
The July level was above Wall Street expectations. Economists surveyed by Dow Jones Newswires were expecting a reading of 56.0.
A reading above 50 indicates expansion in the manufacturing sector and a reading below 50 indicates a contraction.
The Chicago survey is watched closely for clues to the index of the Institute for Supply Management. The ISM July survey will be released Tuesday morning.
The Chicago index is based on a survey of purchasing managers in northern Illinois and northwestern Indiana, one of the largest industrial areas in the United States.
The prices paid index fell to 86.8 in July from 89.0 in June. The supplier deliveries index fell to 55.5 in July from 55.7 in June. The employment index rose to 50.5 in July from 50.4 in June, and the new orders index rose to 60.0 in July from 57.2 in June.