December was a soft month for the economy based on the national activity index which fell 0.15 following November's marginal 0.01 percent rise.

All four central components were flat: production pulled the index down 0.06 points as did employment also at 0.06; sales, orders, and inventories were negative 0.04 with personal consumption and housing the only positive contributor but at a mere 0.01.

The index's three-month average fell to minus 0.28 from minus 0.24 in November and following October's 0.31 decline, all indicating tangible underperformance in economic growth. Looking at these numbers you would never guess fourth-quarter GDP would exceed expectations at 3.3 percent annualized growth.

The Chicago Fed National Activity Index (CFNAI) is a monthly index that tracks overall economic activity and inflationary pressures. 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 over time, a positive index reading corresponds to growth above trend and a negative index reading corresponds to growth below trend.

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.