Research >> Economics
Chicago Fed National Activity points to a moderation in economic growth in July
|
Led by slower growth in production-related indicators, the Chicago Fed National Activity Index (CFNAI) declined to +0.13 in July from +0.48 in June. Three of the four broad categories of indicators that make up the index decreased from June, but three of the four categories made positive contributions to the index in July. The index’s three-month moving average, CFNAI-MA3, moved down to +0.05 in July from +0.20 in June.
The CFNAI Diffusion Index, which is also a three-month moving average, decreased to +0.08 in July from +0.19 in June. Thirty-six of the 85 individual indicators made positive contributions to the CFNAI in July, while 49 made negative contributions. Thirty-four indicators improved from June to July, while 51 indicators deteriorated. Of the indicators that improved, 13 made negative contributions.
The contribution from production-related indicators to the CFNAI declined to +0.05 in July from +0.45 in June. Total industrial production edged up 0.1 percent in July after rising 1.0 percent in June. The sales, orders, and inventories category made a contribution of +0.03 to the CFNAI in July, down slightly from +0.06 in June. The Institute for Supply Management’s Manufacturing New Orders Index decreased to 60.2 in July from 63.5 in June.
Employment-related indicators contributed +0.12 to the CFNAI in July, up from +0.03 in June. The civilian unemployment rate decreased to 3.9 percent in July from 4.0 percent in June. The contribution of the personal consumption and housing category to the CFNAI ticked down to –0.07 in July from –0.06 in June. Consumption indicators deteriorated, on balance, pushing down the category’s overall contribution. However, housing indicators improved slightly.
The CFNAI was constructed using data available as of August 23, 2018. At that time, July data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The June monthly index value was revised to +0.48 from an initial estimate of +0.43, and the May monthly index value was revised to –0.46 from last month’s estimate of –0.45. 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 June and May monthly index values were primarily due to the former.
Posted: August 27, 2018 Monday 08:30 AM