The Chicago Fed national activity index was negative 2.30 in May, a level little changed from the negative 2.27 figure in April. All four broad categories of indicators made negative contributions to the index in May.
The three-month moving average, CFNAI-MA3, was negative 2.67 in May, up slightly from negative 2.73 in April.
May’s CFNAI-MA3 suggests that growth in national economic activity was well below its historical trend.
With regard to inflation, the amount of national economic slack reflected in the CFNAI-MA3 indicates low inflationary pressure from economic activity over the coming year.
The small decrease in the index in May was primarily due to the production and income category of indicators.
The category made a larger negative contribution to the index in May, negative 0.65, compared with its contribution in April of negative 0.47.
Total industrial production declined 1.1% in May after decreasing 0.7% in April. In addition, manufacturing capacity utilization moved down to 65% in May from 65.6% in the previous month.
Employment-related indicators made the largest negative contribution to the index in May, coming in at negative 0.99, which was down slightly from negative 0.94 the month before.
Total nonfarm payroll employment decreased by 345,000 in May after declining 504,000 in April. However, the unemployment rate increased to 9.4% in May from 8.9% in the previous month.
The consumption and housing category made a contribution of negative 0.56 to the index in May, following a contribution of negative 0.66 in April.
Housing starts increased to 532,000 annualized units in May from 454,000 the month before.
Real personal consumption expenditures on durable goods increased 0.9% in May after declining 1.4% in April.
The sales, orders, and inventories category made a contribution of 0.11 to the index in May after contributing negative 0.21 in April.
