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Chicago Fed National Activity Index Rises Above Zero

   By Dave Sebastian 
 

The Chicago Fed National Activity Index, a measure of economic activity in the U.S., rose to positive territory in August after sinking below zero in July.

For August, the index was 0.10, up from -0.41 the month before. The Federal Reserve Bank of Chicago said all four broad categories that comprise the index increased from July, but three of the four categories negatively contributed.

Production-related indicators contributed 0.16 in August, up from -0.26 in July. Industrial production rose 0.6% in August after decreasing 0.2% in July, though the Institute for Supply Management's Manufacturing Composite Index decreased to 49.1 in August from 51.2 in July. In August, the sales, orders and inventories category ticked up to -0.02 from -0.07 in July.

Employment-related indicators contributed -0.02 in August, up from -0.05 in July. The personal-consumption and housing category inched up to -0.02 from -0.03 in the previous month. Total nonfarm payrolls increased by 130,000 in August, lower than the rise of 159,000 in July.

Eighty-five indicators make up the index, and of those, 44 positively contributed and 41 negatively contributed. A total of 52 of the 85 indicators improved from the prior month, while 30 deteriorated and three were unchanged. Fourteen of the 85 contributors worsened, the Chicago Fed said.

The CFNAI-MA3, which the Chicago Fed says can show a more consistent view of economic growth, was -0.06. The three-month moving average was up from -0.14 the previous month.

The Chicago Fed said the CFNAI Diffusion index increased up to -0.12 in August from -0.2 in July. That three-month moving average shows how much a change in the monthly index spans across its more than 80 indicators, the Chicago Fed said.

A CFNAI-MA3 reading of more than -0.70 and a CFNAI Diffusion Index reading of more than -0.35 have historically indicated economic expansion, the Chicago Fed said.

 

Write to Dave Sebastian at dave.sebastian@wsj.com

 

(END) Dow Jones Newswires

September 23, 2019 08:46 ET (12:46 GMT)

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