The Chicago Fed National Activity Index: March 2016

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity worsened in March with the index falling to a contraction level of -0.44 from a level of -0.38 a month earlier while the three month moving average also weakening to a level of -0.18.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

You’ve Gotta ask Yourself One Question

Do you feel your economy will get lucky? … Well do you, punk!?

I for one believe that the path of least resistance is down at this point and to that end I offer the following data-point coming from today’s release of the Chicago National Activity Index (CFNAI).

The following chart shows the very sensitive diffusion index that the Chicago Fed distills from the other CFNAI measures.

Notice that while this measure improved slightly from last month, its current level of -0.12 is notably weak as well comes just two months after the October level of -0.23, the lowest level seen during our latest economic expansion and caps an entire year of values that appear to be generally trending down.

The Chicago Fed considers the crossing of -0.35 of this measure as a “[signal] of the increased likelihood of the beginning (from above) and the end of a recession (from below)”, so while we are not yet at that threshold, given the current trends (recessionary manufacturing sector, mounting inventories, deflating commodities, falling stocks and wealth effect, etc.) you’ve got to ask yourself one question… will the economy get lucky?

The Chicago Fed National Activity Index: March 2015

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that the national economic activity weakened in March with the index falling to a level of -0.42 from a level of -0.18 in February while the three month moving average also declined to a level of -0.27.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: July 2013

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that the national economy remained near contraction in July with the index improving to weak level of -0.15 from a level of -0.23 in June while the three month moving average improved to a level of -0.15.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: May 2013

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that the national economy remained near contraction in May with the index improving to -0.30 from a level of -0.52 in April while the three month moving average declined to a level of -0.43.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: March 2013

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated worsening for the national economy with the index falling to a weak level of -0.23 from a level of 0.76 in February while the three month moving average declined to a level of -0.01.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: February 2013

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated improvement for the national economy with the index rising to a level of 0.44 from a level of -0.49 in January while the three month moving average declined to a level of 0.09.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: November 2012

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated a slight improvement for the national economy with the index climbing to a tepid level of .10 from a notably weak level of -.64 in October while the three month moving average improved to a weak level of -0.20.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: September 2012

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) showed an improvement of the national economy with the index climbing from the prior month to stand at a very weak 0.00 while the three month moving average remained very near contraction territory at -0.37.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: September 2011

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) continued to indicate the weakness of national economic trends with the index remaining in contraction territory at -0.22 while the three month moving average improved slightly to -0.21.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The Chicago Fed National Activity Index: April 2011

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity slowed notably in April with the index falling into contraction territory of -0.45 while the three month moving declined to -0.12.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.12, the current three month average index value is indicating that contraction may be in the offing.

The Chicago Fed National Activity Index: March 2011

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity increased in March with the index climbing to 0.26 while the three month moving declined slightly to 0.20.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at 0.20, the current three month average index value is indicating weak trend growth.

The Chicago Fed National Activity Index: February 2011

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity slowed in February with the index weakening to -0.04 while the three month moving increased to 0.11.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at 0.11, the current three month average index value is indicating weak trend growth.

The Chicago Fed National Activity Index: December 2010

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity climbed further out of contraction in November with the index strengthening to 0.03 while the three month moving average climbed to -0.22.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.22, the current three month average index value is indicating extremely weak growth.

The Chicago Fed National Activity Index: October 2010

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity remained in contraction in October with the index improving slightly to -0.28 while the three month moving average dropped to -0.46.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.46 the current three month average index value is indicating extremely weak growth nearing the recessionary level of -0.70.

The Chicago Fed National Activity Index: August 2010

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity weakened notably in August with the index declining to -0.53 from a revised -0.11 in July while the three month moving average declined to -0.42.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.43 the current three month average index value is indicating extremely weak growth near the recessionary level of -0.70.

The Chicago Fed National Activity Index: June 2010

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity slumped significantly in May with the index declining to -0.63 while the three month moving average fell to -0.05.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.05 the current three month average index value is indicating very weak growth.

The Chicago Fed National Activity Index: January 2010

Today’s release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity continued to improve in January with only the "personal consumption and housing" component showing significant weakness.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national is expanding at its historical trend rate while a negative value indicate below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

It’s important to note that at -0.16 the current three month average index value is indicating very weak growth after several recent months of intermittent recessionary and near recessionary growth.

The "personal consumption and housing" component, on the other hand, is continuing to show very weak results and at -.45, is at a level only marginally better than the worst levels seen this cycle.

The following charts (click for full-screen interactive zoom-able version) plot the national activity index as well all of its four components.