The Federal Reserve Bank of Chicago reported that its National Activity Index rose to 0.10 during August from -0.41 in July. The three-month moving average, which irons out volatility in the monthly figures, rose to -0.06 last month versus July's reading of -0.14. It was the highest level since January and sharply above the April low. During the last twenty years, there has been a 70% correlation between the Chicago Fed Index and the q/q change in real GDP.

The National Activity Diffusion Index, which measures the breadth of movement in the monthly series, also improved to -0.12 from -0.20. That remained below the peak of 0.41 in December 2017.

Improvement in the August index reflected increases in each of the component series. The Production & Income series led the gains with improvement to 0.16, its highest level in 12 months. The Sales, Orders & Inventories sub-group rose to -0.02 from -0.07, but remained well below its earlier highs. The Employment, Unemployment & Hours series recaptured its July decline and rose to -0.02 from -0.05. It has been moving sideways for six months. The Personal Consumption & Housing reading edged higher to -0.02 from -0.03, yet remained above February's low of -0.11.

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.