The August Chicago Business Barometer showed that the economy remained in positive territory, but the growth was less positive in August than July. The Institute for Supply Management’s report on the Chicago regional view of the national economy was down by 0.3 points to 54.4 in August. Bloomberg had the consensus estimate actually growing up to 54.9. Dow Jones and the Wall Street Journal had the consensus estimate pegged at 54.5.

It turns out that the production index and the new orders index reading softened in August. While the Chicago Business Barometer was shown to have held on to most of July’s gains, perhaps the big focus here should be that things did not fall apart. This remains consistent with a recovery in the third quarter’s business activity after the recent weak growth readings.

New orders and production softened in August, but both readings remained above their 12-month averages and were shown to be up significantly from the depressed levels seen between February and June.

The feedback from companies was mixed, but the overall positive tone of the survey suggests that there was a deliberate stock-build in inventories.

Order backlogs fell slightly, remaining below the 50 break-even level for the seventh consecutive month.

Employment rose in August to the highest since April, but the labor component remained in contraction for the fourth consecutive month. It also remains close to June’s nearly five-and-a-half-year low.

Prices paid had risen over the past three months, but the indicator fell sharply into contraction in August after oil and other commodity prices plunged.

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All in all, the growth here looks less convincing. But strength is less than convincing and this report suggests that activity for the Chicago-area economy may be flat going into year end. If you thought that the plunge in demand from China might crush the United States, this adds at least some stability — and it also adds stability enough for the Federal Reserve to remain a risk.

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