Chicago Fed: Economic growth slows in December
Led by declines in production-related indicators, the Chicago Fed National Activity Index (CFNAI) decreased to 0.02 in December from 0.27 in November. Two of the four broad categories of indicators that make up the index decreased from November, and only two of the four categories made positive contributions to the index in December.
The index’s more stable three-month moving average remains negative, although it improved from -0.13 in November to -0.11 in December. That’s the tenth straight reading below zero, and it suggests that growth in national economic activity was below its historical trend. The Chicago Fed said that the level of growth reflected in the three-month moving average suggests subdued inflationary pressure from economic activity over the coming year.
The CFNAI is a weighted average of 85 indicators of national economic activity drawn from four broad categories of data: (1) production and income; (2) employment, unemployment, and hours; (3) personal consumption and housing; and (4) sales, orders, and inventories. A zero value for the index indicates that the national economy is expanding at its historical trend rate of growth. Negative values indicate below-average growth, and positive values indicate above-average growth.