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Chicago Fed National Activity Index suggests economic growth moderated in November 2021
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Led by slower growth in production-related indicators, the Chicago Fed National Activity Index (CFNAI) decreased to +0.37 in November from +0.75 in October. Three of the four broad categories of indicators used to construct the index made positive contributions in November, but all four categories deteriorated from October. The index’s three-month moving average, CFNAI-MA3, moved up to +0.37 in November from +0.25 in October.
The CFNAI Diffusion Index, which is also a three-month moving average, increased to +0.35 in November from +0.18 in October. Fifty-three of the 85 individual indicators made positive contributions to the CFNAI in November, while 32 made negative contributions. Thirty-two indicators improved from October to November, while 53 indicators deteriorated. Of the indicators that improved, ten made negative contributions.
Production-related indicators contributed +0.21 to the CFNAI in November, down from +0.42 in October. Industrial production increased 0.5 percent in November after rising 1.7 percent in the previous month. The contribution of the sales, orders, and inventories category to the CFNAI edged down to +0.03 in November from +0.06 in October.
Employment-related indicators contributed +0.18 to the CFNAI in November, down slightly from +0.23 in October. Nonfarm payrolls increased by 210,000 in November after rising by 546,000 in October, but the unemployment rate decreased to 4.2 percent in November from 4.6 percent in the previous month. The contribution of the personal consumption and housing category to the CFNAI moved down to –0.05 in November from +0.04 in October. On balance, consumption indicators weakened from October, pushing down the category’s overall contribution in November.
The CFNAI was constructed using data available as of December 20, 2021. At that time, November data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The October monthly index value was revised to +0.75 from an initial estimate of +0.76, and the September monthly index value was revised to –0.01 from last month’s estimate of –0.18. 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 revisions to both the October and September monthly index values were primarily due to the former.
Posted: December 22, 2021 Wednesday 08:30 AM