Global| Mar 23 2015Chicago Fed National Activity Index Deteriorates
by:Tom Moeller
|in:Economy in Brief
Summary
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) for February declined to -0.11 from -0.10 in January, revised from +0.13. The three-month moving average also turned negative. The reading of -0.08 was the [...]
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) for February declined to -0.11 from -0.10 in January, revised from +0.13. The three-month moving average also turned negative. The reading of -0.08 was the first below zero in twelve months. During the last ten years, there has been a 76% correlation between the Chicago Fed Index and the q/q change in real GDP.
Two of the four component series were negative last month, the same as during the prior two months. The Personal Consumption & Housing series was negative 0.17, its weakest reading since January of last year. The Production & Income figure of -0.07 was the fourth number below zero in the last five months. At 0.02, the Sales, Orders and Inventories series remained weak. The Employment, Unemployment and Hours reading declined to 0.11, its lowest level in six months. The three-month moving average of the total deteriorated to -0.08, the first negative reading in a year. The Fed reported that 48 of the 85 component series made positive contributions to the total while 37 made negative contributions. This breadth of increase was the same as during January.
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 | Feb | Jan | Dec | Feb '14 | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| CFNAI | -0.11 | -0.10 | -0.02 | 0.59 | 0.21 | 0.01 | -0.05 |
| 3-Month Moving Average | -0.08 | 0.26 | 0.35 | -0.12 | -- | -- | -- |
| Personal Consumption & Housing | -0.17 | -0.07 | -0.13 | -0.12 | -0.11 | -0.14 | -0.20 |
| Employment, Unemployment & Hours | 0.11 | 0.16 | 0.23 | 0.08 | 0.18 | 0.10 | 0.09 |
| Production & Income | -0.07 | -0.20 | -0.22 | 0.52 | 0.10 | 0.03 | 0.06 |
| Sales, Orders & Inventories | 0.02 | 0.01 | 0.10 | 0.11 | 0.04 | 0.03 | -0.00 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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