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Chicago Fed National Activity Index points to a rebound in economic growth in November
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Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rose to +0.56 in November from –0.76 in October. All four broad categories of indicators that make up the index increased from October, and two of the four categories made positive contributions to the index in November. The index’s three-month moving average, CFNAI-MA3, moved up to –0.25 in November from –0.35 in October.
The CFNAI Diffusion Index, which is also a three-month moving average, ticked up to –0.23 in November from –0.24 in October. Fifty of the 85 individual indicators made positive contributions to the CFNAI in November, while 35 made negative contributions. Sixty-four indicators improved from October to November, while 21 indicators deteriorated. Of the indicators that improved, 19 made negative contributions.
Production-related indicators contributed +0.49 to the CFNAI in November, up from –0.60 in October. Industrial production rose 1.1 percent in November after decreasing 0.9 percent in October. The contribution of the sales, orders, and inventories category to the CFNAI ticked up to –0.04 in November from –0.05 in October.
Employment-related indicators contributed +0.12 to the CFNAI in November, up from –0.07 in October. Nonfarm payrolls rose by 266,000 in November after increasing by 156,000 in October, and the unemployment rate ticked down to 3.5 percent in November from 3.6 percent in the previous month. The contribution of the personal consumption and housing category to the CFNAI edged up to –0.02 in November from –0.05 in October. Housing starts increased to 1,365,000 annualized units in November from 1,323,000 in October.
The CFNAI was constructed using data available as of December 19, 2019. 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 –0.76 from an initial estimate of –0.71, and the September monthly index value was revised to –0.54 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 revision to the October monthly index value was due to both factors almost equally. The revision to the September monthly index value was primarily due to revisions in previously published data.
Posted: December 23, 2019 Monday 08:30 AM