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Chicago Fed National Activity picked up slightly in June
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The index’s three-month moving average, CFNAI-MA3, edged up to –0.01 in June from –0.07 in May. June’s CFNAI-MA3 suggests that growth in national economic activity was very close to its historical trend. The economic growth reflected in this level of the CFNAI-MA3 suggests limited inflationary pressure from economic activity over the coming year.
The CFNAI Diffusion Index, which is also a three-month moving average, moved up to +0.07 in June from –0.01 in May. Forty-eight of the 85 individual indicators made positive contributions to the CFNAI in June, while 37 made negative contributions. Forty-four indicators improved from May to June, while 40 indicators deteriorated and one was unchanged. Of the indicators that improved, 13 made negative contributions.
The contribution from production-related indicators to the CFNAI rose to –0.01 in June from –0.08 in May. Industrial production was up 0.3 percent in June after decreasing 0.2 percent in May; however, manufacturing production was unchanged in June.
The contribution from employment-related indicators to the CFNAI increased to +0.12 in June from +0.06 in May. The unemployment rate decreased to 5.3 percent in June from 5.5 percent in May. The sales, orders, and inventories category also made a positive contribution to the CFNAI in June, edging up to +0.03 from –0.01 in May.
Personal consumption and housing-related indicators contributed –0.07 to the CFNAI in June, down slightly from –0.05 in May. Consumption indicators, on balance, deteriorated, pushing the category’s contribution lower. However, housing starts increased to 1,174,000 annualized units in June from 1,069,000 in May; and housing permits also moved up, to 1,343,000 annualized units in June from 1,250,000 in the previous month.
The CFNAI was constructed using data available as of July 20, 2015. At that time, June data for 50 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The May monthly index was revised to –0.08 from an initial estimate of –0.17, and the April monthly index was revised to –0.04 from last month’s estimate of –0.19. Revisions to the monthly index can be attributed to two main factors: revisions in previously published data and differences between the estimates of previously unavailable data and subsequently published data. The revision to the May monthly index was due primarily to the former, while the revision to the April monthly index was due primarily to the latter.
Posted: July 23, 2015 Thursday 08:30 AM