Research >> Economics
Chicago Fed National Activity slightly below average in May
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The index’s three-month moving average, CFNAI-MA3, increased slightly to –0.16 in May from –0.20 in April. May’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, was unchanged at –0.13 in May. Thirty-five of the 85 individual indicators made positive contributions to the CFNAI in May, while 50 made negative contributions. Forty-three indicators improved from April to May, while 41 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 up to –0.17 in May from –0.19 in April. Industrial production was down 0.2 percent in May after decreasing 0.5 percent in April. The sales, orders, and inventories category made a neutral contribution to the CFNAI in May, up slightly from –0.01 in April.
The contribution from employment-related indicators to the CFNAI remained at +0.10 in May. Nonfarm payrolls increased by 280,000 in May, following a gain of 221,000 in the previous month; however, the unemployment rate edged up to 5.5 percent in May from 5.4 percent in April.
The contribution of the personal consumption and housing category to the CFNAI was steady at –0.09 in May. Housing starts decreased to 1,036,000 annualized units in May from 1,165,000 in April. However, housing permits increased to 1,275,000 annualized units in May from 1,140,000 in the previous month.
The CFNAI was constructed using data available as of June 18, 2015. At that time, May data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The April monthly index was revised to –0.19 from an initial estimate of –0.15. 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 April monthly index was due primarily to the former.
Posted: June 22, 2015 Monday 08:30 AM