Chicago Fed Activity Index Improves to Negative 0.58

The Chicago Fed national activity index for January improved, rising to negative 0.58 from an upwardly revised negative 0.69 reading in December, originally reported as negative 0.91.

Meanwhile, the three-month moving average increased to negative 0.60 in January after December’s number was downwardly revised to negative 0.69 from negative 0.67, the Federal Reserve Bank of Chicago reported yesterday.

In January 2007, the index was negative 1.00, while the three-month moving average was negative 0.34 that month.

The negative reading for the moving average indicates national economic growth was below its historical trend and suggests little inflationary pressure from economic activity in the coming year.

Production-related indicators contributed negative 0.08 to the index, compared to a contribution of negative 0.09 in December, while employment-related indicators contributed negative 0.25 after providing a negative 0.31 in December, the Chicago Fed said.

Consumption and housing-related data contributed negative 0.23 compared to December’s negative 0.28, while sales, orders, and inventories contributed negative 0.01 after a negative 0.01 the previous month.

Overall, 29 of the 85 indicators made positive contributions to the index nd 56 made negative contributions. While 46 indicators were better than December, 22 of these still made negative contributions to the index. Also, 39 indicators deteriorated from December to January.

The index was constructed using data available by Feb. 21, with data for 52 of the 85 indicators having been published by then. The Fed said it used estimates for the missing data.

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