Global| Mar 25 2013U.S. Chicago Fed National Activity Index Suggests Moderate Economic Growth
by:Tom Moeller
|in:Economy in Brief
Summary
The Chicago Federal Reserve reported that its February National Activity Index (CFNAI) rose to 0.44 from a downwardly revised -0.49 in January. Smoothing out the m/m volatility, the three-month moving average deteriorated to 0.09, its [...]
The Chicago Federal Reserve reported that its February National
Activity Index (CFNAI) rose to 0.44 from a downwardly revised -0.49 in
January. Smoothing out the m/m volatility, the three-month moving
average deteriorated to 0.09, its weakest reading since October. During
the last ten years, there has been a 79% correlation between the Chicago
Fed Index and the q/q change in real GDP.
The Production & Income component showed the sharpest m/m improvement. It made up all of January's sharp decline and returned to the December level. The Employment, Unemployment and Hours series also recovered to its highest level since last March. The Sales, Orders & Inventories series improved with a return to positive territory after two months in the red. The Personal Consumption & Housing series rose moderately leaving in place its upward trend since the middle of 2011. The Chicago Fed reported that during February, 58 of the 85 individual indicators made positive contributions to the overall index while 27 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 | Feb | Jan | Dec | Feb'12 | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|---|---|
| CFNAI | 0.44 | -0.49 | 0.33 | 0.25 | -0.09 | -0.04 | 0.04 |
| 3-Month Moving Average | 0.09 | 0.28 | 0.26 | 0.46 | -- | -- | -- |
| Personal Consumption & Housing | -0.16 | -0.19 | -0.14 | -0.23 | -0.22 | -0.30 | -0.30 |
| Employment, Unemployment & Hours | 0.20 | 0.01 | 0.14 | 0.21 | 0.10 | 0.14 | 0.03 |
| Production & Income | 0.34 | -0.28 | 0.35 | 0.25 | 0.04 | 0.09 | 0.22 |
| Sales, Orders & Inventories | 0.05 | -0.01 | -0.03 | 0.02 | -0.01 | 0.04 | 0.09 |
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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