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This morning, the Federal Reserve Bank of Chicago released July 2010 figures for the Chicago Fed National Activity Index (CFNAI), a measure of how the national economy is faring relative to its historical trend rate. Three of the four categories of indicators that make up the index improved from June, causing the CFNAI to bounce back to 0.00 in July from -0.70 in June; however the 3-month moving average (MA3) declined again from -0.12 in June to -0.17 in July. (When the CFNAI-MA3 moves above -0.70 following a period of economic contraction, there is an increasing likelihood that a recession has ended; surpassing a level of +0.20 indicates economic activity associated with sustained recovery).
Note: The index was constructed using data available as of 08/23/10. At that time, July data for 52 of the 85 indicators had been published; for all missing data,
estimates were used in constructing the index and CFNAI-MA3. Source: Federal Reserve Bank of Chicago
Of the 85 indicators that contribute to the index (production/income indicators, sales/orders/inventories indicators, employment/unemployment/hours indicators, and personal consumption/housing indicators):
- 56 improved from June 2010, while 28 deteriorated (one was unchanged); 46 made positive contributions, while 39 made negative contributions.
- Both industrial and manufacturing production improved in July, by 1.0% and 1.1%, respectively, bringing July’s overall production-related indicators’ index contribution to +0.43, up from -0.16 in June.
- The sales, orders, and inventories and employment-related indicators categories both made neutral contributions to the index in July, down from +0.06 and -0.14, respectively in June.
- The overall personal consumption and housing category made a negative contribution in July (-0.43), improving only slightly over June’s figure of -0.46.
The full news release can be found on the Federal Reserve Bank of Chicago website.
