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Chicago Fed National Activity Points to a Pickup in Economic Growth in September
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Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) moved up to +0.17 in September from –0.37 in August. All four broad categories of indicators that make up the index increased from August, and three of the four categories made positive contributions to the index in September. The index’s three-month moving average, CFNAI-MA3, was unchanged at –0.16 in September.
The CFNAI Diffusion Index, which is also a three-month moving average, ticked up to –0.19 in September from –0.20 in August. Forty-six of the 85 individual indicators made positive contributions to the CFNAI in September, while 39 made negative contributions. Fifty-four indicators improved from August to September, while 30 indicators deteriorated and one was unchanged. Of the indicators that improved, 17 made negative contributions.
The contribution from production-related indicators to the CFNAI increased to +0.10 in September from –0.33 in August. Total
industrial production increased 0.3 percent in September after moving down 0.7 percent in August. The sales, orders, and inventories category also made a positive contribution to the CFNAI in September, edging up to +0.07 from +0.06 in August.
Employment-related indicators contributed +0.06 to the CFNAI in September, up from +0.01 in August. Civilian employment increased by 906,000 in September after decreasing by 74,000 in August, and the civilian unemployment rate moved down to 4.2 percent in September from 4.4 percent in the previous month. However, nonfarm payrolls decreased by 33,000 in September after increasing by 169,000 in August.
The contribution of the personal consumption and housing category to the CFNAI increased to –0.07 in September from –0.11 in August. Consumption indicators improved, on balance, pushing up the category’s overall contribution. However, housing starts
decreased to 1,127,000 annualized units in September from 1,183,000 in August, and housing permits decreased to 1,215,000 annualized units in September from 1,272,000 in the previous month.
The CFNAI was constructed using data available as of October 19, 2017. At that time, September data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The August monthly index value was revised to –0.37 from an initial estimate of –0.31, and the July monthly index value was revised to –0.27 from last month’s estimate of +0.03. 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 August monthly index value was primarily due to the latter, while the revision to the July monthly index value was primarily due to the former.
Posted: October 23, 2017 Monday 08:30 AM