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Economy in Brief

Chicago Fed National Activity Index Improves Slightly
by Tom Moeller  February 23, 2015

The Chicago Federal Reserve reported that its National Activity Index (CFNAI) for January increased to 0.13 from a little-revised -0.07 in January. The three-month moving average remained fairly stable at a high 0.33. During the last ten years, there has been a 76% correlation between the Chicago Fed Index and the q/q change in real GDP.

Slight m/m improvement was logged by three of the index component series last month. The Production & Income component posted a moderate rebound to 0.02 following its sharp pullback in December. The Personal Consumption & Housing series also gained to -0.10 following a sharp December decline. The Sales, Orders and Inventories series ticked higher to -0.10 but remained near its recent low. The Employment, Unemployment and Hours reading declined to 0.18, its lowest level since August. The-month moving average of the total slipped to a still-firm 0.33. The Fed reported that 48 of the 85 component series made positive contributions to the total while 37 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.

Chicago Federal Reserve Bank Jan Dec Nov Jan'14 2014 2013 2012
CFNAI 0.13 -0.07 0.92 -0.83 0.21 -0.00 -0.05
 3-Month Moving Average 0.33 0.34 0.48 -0.09 -- -- --
  Personal Consumption & Housing -0.10 -0.13 -0.04 -0.24 -0.11 -0.14 -0.20
  Employment, Unemployment & Hours 0.18 0.28 0.27 0.12 0.17 0.09 0.09
  Production & Income 0.02 -0.22 0.63 -0.42 0.12 0.03 0.06
  Sales, Orders & Inventories 0.03 0.00 0.07 -0.28 0.03 0.03 -0.00
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