|Level||0.15||-0.20 to 0.50||0.13||-0.05||-0.07|
|3 Month Moving Average||0.33||0.39||0.34|
January was a good month for the economy based on the national activity index which jumped back into the plus column, to 0.13 from December's revised minus 0.7. The 3-month average is very strong, little changed at plus 0.33.
The big swing factor for January is production-related indicators which rose to plus 0.02 from December's minus 0.22 in a gain driven by a swing higher for industrial production. The negative reading from consumption & housing improved to minus 0.10 from minus 0.13 while the contribution from sales/orders/inventories held unchanged at plus 0.03. Employment remains a big plus but, due to a tick higher for the unemployment rate to 5.7 percent, a little less so, at plus 0.18 from plus 0.28.
Market Consensus Before Announcement
The Chicago Fed National Activity Index for December was weak, at negative 0.05 vs plus 0.92 in November. All four components of the index fell relative to November with two in outright contraction. But the 3-month average remained in the positive column though it did slow, to plus 0.39 from December's plus 0.54.
The Chicago Fed National Activity Index (CFNAI) is a monthly index designed to better gauge overall economic activity and inflationary pressure. The CFNAI is released at 8:30 a.m. E.T. normally toward the end of each calendar month. The CFNAI is a weighted average of 85 existing monthly 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 85 economic indicators that are included in the CFNAI are drawn from four broad categories of data: production and income; employment, unemployment, and hours; personal consumption and housing; and sales, orders, and inventories. Each of these data series measures some aspect of overall macroeconomic activity. The derived index provides a single, summary measure of a factor common to these national economic data.
This index is unique among regional Federal Reserve Bank indexes in that it is national in scope. Investors are eager to have insight into economic growth and inflation. This index combines 85 diverse and already released indicators from four broad categories -- production and income; employment, unemployment, and hours; personal consumption and housing; and sales, orders, and inventories -- into an overall index to measure economic performance. The index provides another measure with which investors can measure overall growth.