Recent Updates

  • Bulgaria: CPI/HICP (Nov)
  • Kazakhstan: Wages (Nov)
  • Petroleum Consumption (Oct)
  • Hungary: Labor Productivity in Industry, Industrial Production Final (Oct)
  • Finland: Wholesale & Retail Trade (Oct), Central Government Debt (Nov)
  • Germany: Service Sector Sales & Employment (Q3)
  • Denmark: MV Registration (Nov)
  • more updates...

Economy in Brief

Negative Readings from the Chicago Fed & the Richmond Fed
by Tom Moeller October 25, 2006

The National Activity Index (CFNAI) from the Federal Reserve Bank of Chicago dropped to a negative 0.51 in September, the third negative monthly reading in a row. As a result, the three-month moving average of the CFNAI fell to -0.25, its first negative value in a year.

A zero value of the CFNAI indicates that the economy is expanding at its historical trend rate of growth. During the last twenty years there has been a 68% correlation between the level of the CFNAI and q/q growth in real GDP.

The CFNAI is a weighted average of 85 indicators of economic activity. The indicators reflect activity in the following categories: production and income, the labor market, personal consumption and housing, manufacturing and trade sales, and inventories & orders.

The latest CFNAI report is available here.

The Federal Reserve Bank of Richmond also indicated that its October Composite Index from the manufacturing survey at -2 was at its lowest level since January. During the last ten years there has been a 38% correlation between the diffusion index level and the one month change in U.S. manufacturing industrial production. The October report can be found here.

The Richmond Fed's survey of the service sector also fell m/m but remained in positive territory. The percentage of firms reporting increasing revenues fell to 5%, the lowest percentage since July, but the percentage of employees held at a high 13%. The latest report is available here.

Chicago Fed September August Sept. '05 2005 2004 2003
CFNAI -0.51 -.06 -0.74 0.20 0.36 -0.15
large image