Research >> Economics
Chicago Fed National Activity Growth Increased in December
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The index’s three-month moving average, CFNAI-MA3, edged up to –0.07 in December from –0.14 in November. December’s CFNAI-MA3 suggests that growth in national economic activity was slightly 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 –0.06 in December. Thirty-seven of the 85 individual indicators made positive contributions to the CFNAI in December, while 48 made negative contributions. Fifty indicators improved from November to December, while thirty-five indicators deteriorated. Of the indicators that improved, 23 made negative contributions.
The contribution from production-related indicators to the CFNAI jumped to +0.20 in December from –0.30 in November. Total industrial production increased 0.8 percent in December after decreasing 0.7 percent in November. In addition, the sales, orders, and inventories category made a contribution of +0.02 to the CFNAI in December, up from –0.01 in November.
The contribution of the personal consumption and housing category to the CFNAI increased to –0.06 in December from –0.10 in November. Housing starts increased to 1,226,000 annualized units in December from 1,102,000 in November, but housing permits ticked down to 1,210,000 annualized units in December from 1,212,000 in the previous month.
Employment-related indicators contributed –0.01 to the CFNAI in December, down from +0.08 in November. The civilian unemployment rate increased to 4.7 percent in December from 4.6 percent in November, and nonfarm payrolls increased by 156,000 in December after rising by 204,000 in the previous month.
The CFNAI was constructed using data available as of January 24, 2017. At that time, December data for 50 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The November monthly index value was revised to –0.33 from an initial estimate of –0.27, and the October monthly index value was revised to –0.01 from last month’s estimate of –0.05. 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 revision to the November monthly index value was primarily due to the former, while the revision to the October monthly index value was primarily due to the latter.
Posted: January 26, 2017 Thursday 08:30 AM