Global| Sep 24 2015Chicago Fed National Activity Index Reverses Earlier Improvement
by:Tom Moeller
|in:Economy in Brief
Summary
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) during August collapsed to -0.41 after jumping to 0.51 in July, revised from 0.34. Ironing out this volatility was the three-month moving average which [...]
The Chicago Federal Reserve reported that its National Activity Index (CFNAI) during August collapsed to -0.41 after jumping to 0.51 in July, revised from 0.34. Ironing out this volatility was the three-month moving average which remained fairly stable near 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.
The Production & Income component again was responsible for most of the volatility in the overall index. It declined to -0.30, reversing most of July's improvement. The Sales, Orders & Inventory component also eased to its lowest reading in three months and the Employment, Unemployment & Hours index declined to its lowest point since March. The Personal Consumption & Housing series eased slightly to -0.08 from -0.06. The Fed reported that 25 of the 85 component series made positive contributions to the total while 60 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 | Aug | Jul | Jun | Aug '14 | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| CFNAI | -0.41 | 0.51 | -0.07 | -0.33 | 0.21 | 0.01 | -0.05 |
| 3-Month Moving Average | 0.01 | 0.02 | -0.10 | 0.16 | -- | -- | -- |
| Personal Consumption & Housing | -0.08 | -0.06 | -0.08 | -0.08 | -0.11 | -0.14 | -0.20 |
| Employment, Unemployment & Hours | -0.01 | 0.18 | 0.12 | 0.08 | 0.18 | 0.10 | 0.09 |
| Production & Income | -0.30 | 0.36 | -0.12 | -0.13 | 0.11 | 0.03 | 0.06 |
| Sales, Orders & Inventories | -0.03 | 0.03 | 0.02 | -0.21 | 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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