Global| Aug 24 2015Chicago Fed National Activity Index Improves to Eight-Month High
by:Tom Moeller
|in:Economy in Brief
Summary
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) during July jumped to 0.34 from -0.07 in June, revised from 0.08. The rise to the highest level since last November pulled the three-month moving average to [...]
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) during July jumped to 0.34 from -0.07 in June, revised from 0.08. The rise to the highest level since last November pulled the three-month moving average to break-even, its best level since January. During the last ten years, there has been a 77% correlation between the Chicago Fed Index and the q/q change in real GDP.
A rise in the Production & Income component was responsible for most of the gain in the overall index. It's increase to 0.28 from -0.14 brought it to the highest level since November. The Personal Consumption & Housing series rose to a firm -0.06 from -0.10 but the Employment, Unemployment & Hours figure remained unchanged at 0.11, still the highest point since February. The Sales, Orders & Inventories reading eased to 0.01 from 0.06. The Fed reported that 50 of the 85 component series made positive contributions to the total while 35 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 | Jul | Jun | May | Jul '14 | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| CFNAI | 0.34 | -0.07 | -0.29 | 0.50 | 0.21 | 0.01 | -0.05 |
| 3-Month Moving Average | 0.00 | -0.08 | -0.12 | 0.30 | -- | -- | -- |
| Personal Consumption & Housing | -0.06 | -0.10 | -0.07 | -0.11 | -0.11 | -0.14 | -0.20 |
| Employment, Unemployment & Hours | 0.11 | 0.11 | 0.07 | 0.10 | 0.18 | 0.10 | 0.09 |
| Production & Income | 0.28 | -0.14 | -0.12 | 0.23 | 0.11 | 0.03 | 0.06 |
| Sales, Orders & Inventories | 0.01 | 0.06 | -0.17 | 0.28 | 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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