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Chicago Fed National Activity edged down in March
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The index’s three-month moving average, CFNAI-MA3, decreased to –0.18 in March from –0.11 in February. March’s CFNAI-MA3 suggests that growth in national economic activity was somewhat below its historical trend. The economic growth reflected in this level of the CFNAI-MA3 suggests subdued inflationary pressure from economic activity over the coming year.
The CFNAI Diffusion Index, which is also a three-month moving average, declined to –0.23 in March from –0.12 in February. Twenty-seven of the 85 individual indicators made positive contributions to the CFNAI in March, while 58 made negative contributions. Forty-two indicators improved from February to March, while 42 indicators deteriorated and one was unchanged. Of the indicators that improved, 21 made negative contributions.
The contribution from production-related indicators to the CFNAI ticked down to –0.31 in March from –0.30 in February. Industrial production declined by 0.6 percent in March for the second straight month. The sales, orders, and inventories category made a neutral contribution to the CFNAI in March, up slightly from –0.03 in February.
The contribution from employment-related indicators to the CFNAI moved down to –0.04 in March from +0.02 in February. The civilian unemployment rate edged up to 5.0 percent in March from 4.9 percent in February. Moreover, nonfarm payrolls increased by 215,000 in March after rising by 245,000 in the previous month.
The contribution of the personal consumption and housing category to the CFNAI ticked down to –0.09 in March from –0.07 in February. Housing starts decreased to 1,089,000 annualized units in March from 1,194,000 in February, and housing permits moved down to 1,086,000 annualized units in March from 1,177,000 in the previous month.
The CFNAI was constructed using data available as of April 19, 2016. At that time, March data for 50 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The February monthly index value was revised to –0.38 from an initial estimate of –0.29, and the January monthly index value was revised to +0.28 from last month’s estimate of +0.41. Revisions to the monthly index value 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 revisions to both the February and January monthly index values were due primarily to the former.
Posted: April 21, 2016 Thursday 08:30 AM