Chicago Fed index shows U.S. economy struggling to lift off after March rebound
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The Chicago Fed's National Activity Index showed the U.S. economy was growing above trend in April but had slowed significantly from March's big rebound, suggesting the economy is having a difficult time gaining traction for a sustained rebound.
By the numbers: April's 0.24 reading was down significantly from the 1.7 reading in March, which followed the first negative reading in almost a year for the index.
What it means: The Chicago Fed's index seeks to answer the question, "Is the economy growing at a rate faster than its potential or slower than its potential?" using a weighted average of 85 existing monthly indicators of U.S. economic activity.
- The index is composed of four broad categories of data: production and income; employment, unemployment and hours; personal consumption and housing; and sales, orders and inventories.
- It is constructed to have an average value of zero and a standard deviation of one.
Watch this space: "The personal consumption and housing category contributed –0.06 to the CFNAI in April, down from +0.50 in March," the Chicago Fed said.
- "The indicators in this category broadly deteriorated from March. The contribution of the employment, unemployment, and hours category to the CFNAI decreased to +0.05 in April from +0.38 in March."
