The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), rose 0.5% in July on a three-month moving average (3MMA) basis following a 0.8% gain in June. On a year-over-year (Y/Y) basis, the barometer rose 16.3% in July (3MMA).

The unadjusted data show a 0.1% advance in July, a slowdown from a 0.3% rise in June and 1.0% gain in May. The diffusion index reached 88% in July. The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for June was revised upward by 0.14 points and the reading for May was revised downward by 0.34 points. Monthly revisions have generally been positive during the past year. The July data are provisional and subject to revision.

"The latest CAB reading is consistent with expansion of commerce, trade and industry, but growth has peaked," said Kevin Swift, Chief Economist at ACC.

In July, production-related indicators were up. Trends in construction-related resins and related performance chemistry were solid and suggest an improving housing market. Resins and chemistry used in other durable goods were strong. Plastic resins used in packaging and for consumer and institutional applications showed firm growth. Performance chemistry for industry was largely positive. Exports grew, reflecting improvement in overseas markets. Equity prices improved, while product and input prices continued to expand, indicating tightness of key markets. Inventory and other supply chain indicators were positive.