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Economy in Brief

Chicago Fed National Activity Index Suggests Weak Economic Growth
by Tom Moeller  April 21, 2016

The National Activity Index from the Federal Reserve Bank of Chicago fell to -0.44 during March. It was the weakest reading since January 2014, suggesting that economic growth was slightly below trend. At -0.18, the three month moving average has been in negative territory since February 2015. During the last ten years, there has been a 77% correlation between the Chicago Fed Index and the q/q change in real GDP.

The Employment, Unemployment & Hours index fell sharply m/m into negative territory for the first time in six months. The Production & Income reading eased to -0.31, the lowest point since November. The Personal Consumption & Housing figure fell m/m to -0.09, its weakest reading since January. Offsetting some of these negative influences, the Sales, Orders & Inventories figure improved to 0.00, a modest rebound from February's decline. The Fed reported that 27 of the 85 component series made positive contributions to the total while 58 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.

The Drag of Energy and Manufacturing on Productivity Growth from the Federal Reserve Bank of Kansas City is available here.

Chicago Federal Reserve Bank Mar Feb Jan Mar '15 2015 2014 2013
National Activity Index (percent) -0.44 -0.38 0.28 -0.19 -0.17 0.16 -0.08
 3-Month Moving Average -0.18 -0.11 -0.13 -0.27 -- -- --
  Personal Consumption & Housing -0.09 -0.07 -0.11 -0.10 -0.09 -0.11 -0.15
  Employment, Unemployment & Hours -0.04 0.02 0.19 -0.05 0.07 0.18 0.09
  Production & Income -0.31 -0.30 0.18 -0.10 -0.14 0.06 -0.04
  Sales, Orders & Inventories 0.00 -0.03 0.02 0.06 -0.02 0.04 0.02
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