Research >> Economics
Chicago Fed National Activity Growth increased in February
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The index’s three-month moving average, CFNAI-MA3, improved to +0.25 in February from +0.07 in January, reaching its highest level since December 2014. February’s CFNAI-MA3 suggests that growth in national economic activity was somewhat above its historical trend. The economic growth reflected in this level of the CFNAI-MA3 suggests limited inflationary pressure from economic activity over the coming year.
The CFNAI Diffusion Index, which is also a three-month moving average, moved up to +0.17 in February from +0.02 in January. Fifty-five of the 85 individual indicators made positive contributions to the CFNAI in February, while 30 made negative contributions. Sixty-three indicators improved from January to February, while 22 indicators deteriorated. Of the indicators that improved, 15 made negative contributions.
Employment-related indicators contributed +0.21 to the CFNAI in February, up from +0.06 in January. The civilian unemployment rate edged down to 4.7 percent in February from 4.8 percent in January; and civilian nonagricultural employment increased by 444,000 in February, following a decrease of 229,000 in the previous month.
The contribution from production-related indicators to the CFNAI edged up to +0.09 in February from +0.04 in January. Manufacturing production increased 0.5 percent for the second consecutive month in February, while total industrial production was unchanged in February after decreasing by 0.1 percent in January. The sales, orders, and inventories category made a contribution of +0.08 to the CFNAI in February, up from –0.01 in January. The Institute for Supply Management’s Manufacturing Purchasing Managers’ New Orders Index increased to 65.1 in February from 60.4 in January.
The contribution of the personal consumption and housing category to the CFNAI increased to –0.03 in February from –0.11 in January. Housing starts increased to 1,288,000 annualized units in February from 1,251,000 in January, but housing permits decreased to 1,213,000 annualized units in February from 1,293,000 in the previous month.
The CFNAI was constructed using data available as of March 17, 2017. At that time, February data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The January monthly index value was revised to –0.02 from an initial estimate of –0.05, and the December monthly index value was revised to +0.41 from last month’s estimate of +0.18. Revisions to the monthly index value 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 January monthly index value was primarily due to the former, while the revision to the December monthly index value was primarily due to the latter.
Posted: March 20, 2017 Monday 08:30 AM