US: Chicago Fed National Activity Index


Mon Apr 20 07:30:00 CDT 2015

Consensus Consensus Range Actual Previous Revised
Level 0.15 -0.26 to 0.20 -0.42 -0.11 -0.18
3 Month Moving Average -0.27 -0.08 -0.12

Highlights
March was not a good month for the economy, an assessment confirmed by the national activity index which fell steeply to minus 0.42 vs an already weak and downwardly revised minus 0.18 in February. And the first quarter as a whole was also weak, reflected in the 3-month average which came in at minus 0.27.

The production component, also at minus 0.27, pulled down the index the most in March followed by personal consumption & housing at minus 0.13. Employment also pulled down the index, at minus 0.3 for a big swing downward vs February's plus 0.11. The only component in positive ground in March, and only barely, was sales/orders/inventories at only plus 0.01.

Market Consensus Before Announcement
The Chicago Fed National Activity Index shows that the economy has indeed gotten off to a slow start this year, confirmed by the national activity index which came in at minus 0.11 in February vs minus 0.10 in January. The 3-month average is in negative ground, at minus 0.08 in February vs plus 0.26 in January. The weakest component in February was for personal consumption & housing, at minus 0.17. The component for production-related indicators, at minus 0.07, is the second weakest. These readings offer tangible confirmation that both housing and manufacturing are pulling down economic growth.

Definition
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.


Description
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.