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Economy in Brief

U.S. Chicago Fed National Activity Index Deteriorates in January
by Tom Moeller  February 25, 2013

The Chicago Federal Reserve reported that its National Activity Index (CFNAI) for January fell to -0.32 from upwardly revised readings of 0.25 and 0.96 in December and November. Despite January weakening, the revisions caused the three-month moving average to improve to 0.30, its highest level since February of last year. During the last ten years, there has been a 79% correlation between the Chicago Fed Index and the q/q change in real GDP.

Deterioration in the component series of the index was widespread last month. The Production & Income component led the decline with a fall into negative territory. However, the index was revised up, and sharply positive in December and November. The Employment, Unemployment and Hours series deteriorated last month to its lowest level since August. The Personal Consumption and Housing series became more negative and dropped to its lowest level since October. Offsetting some of these declines was improvement in the Sales, Orders & Inventories figure. The Chicago Fed reported that during January, 34 of the 85 individual indicators made positive contributions to the index while 51 made negative contributions.

The CFNAI is a weighted average of 85 indicators of national economic activity. It is constructed to have an average value of zero and a standard deviation of one. Since economic activity tends toward trend growth rate over time, a positive index reading corresponds to growth above trend and a negative index reading corresponds to growth below trend.

The Chicago Federal Reserve figures are available in Haver's SURVEYS database. 

Unemployment among recent veterans during the Great Recession from the Federal Reserve Bank of Chicago is available here.


Chicago Federal Reserve Bank Jan Dec Nov Jan'12 2012 2011 2010
CFNAI -0.32 0.25 0.96 0.42 -0.09 -0.04 0.04
 3-Month Moving Average 0.30 0.23 0.12 0.28 -- -- --
  Personal Consumption & Housing -0.20 -0.13 -0.14 -0.24 -0.22 -0.30 -0.30
  Employment, Unemployment & Hours 0.02 0.10 0.11 0.38 0.10 0.14 0.03
  Production & Income -0.17 0.35 0.73 0.35 0.04 0.09 0.22
  Sales, Orders & Inventories 0.03 -0.07 0.26 -0.07 -0.01 0.04 0.09
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