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Chicago Fed National Activity Index Suggests a pickup in economic growth in July 2023
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Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rose to +0.12 in July from –0.33 in June. Two of the four broad categories of indicators used to construct the index increased from June, and two of the four categories made positive contributions in July. The index’s three-month moving average, CFNAI-MA3, ticked up to –0.13 in July from –0.15 in June.
The CFNAI Diffusion Index, which is also a three-month moving average, edged up to –0.05 in July from –0.08 in June. Forty-five of the 85 individual indicators made positive contributions to the CFNAI in July, while 40 made negative contributions. Forty-nine indicators improved from June to July, while 35 indicators deteriorated and one was unchanged. Of the indicators that improved, 15 made negative contributions.
Production-related indicators contributed +0.18 to the CFNAI in July, up from –0.36 in June. Industrial production increased 1.0 percent in July after decreasing 0.8 percent in the previous month. The contribution of the sales, orders, and inventories category to the CFNAI moved down to –0.05 in July from +0.02 in June.
Employment-related indicators contributed –0.02 to the CFNAI in July, down slightly from +0.01 in June. The contribution of the personal consumption and housing category to the CFNAI ticked up to +0.02 in July from a neutral value in June.
The CFNAI was constructed using data available as of August 22, 2023. 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 –0.33 from an initial estimate of –0.32, and the May monthly index value was revised to –0.18 from last month’s estimate of –0.28. 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 revision to the June monthly index value was primarily due to the former, while the revision to the May monthly index value was primarily due to the latter.
Posted: August 24, 2023 Thursday 08:30 AM