The Chicago Fed National Activity Index (CFNAI) was –0.20 in July, a small improvement from the June reading of –0.32. The negative value for the index in July reflected continued weakness in employment-related data; the contributions of other components of the CFNAI netted to a small positive value. The three-month moving average index, CFNAI-MA3, improved as well, from –0.59 in June to –0.29 in July. CFNAI-MA3 values below zero are associated with below-trend economic growth. Accordingly, the CFNAI-MA3 value of –0.29 suggests that growth in national economic activity continued to be below its historical trend in July. The relatively large increase in the July CFNAI-MA3 reflects the fact that the three-month average no longer includes the very low monthly reading recorded in April, –1.10, when the economy was most severely influenced by the conflict in Iraq. With regard to inflation, CFNAI-MA3 values below zero signal reduced inflationary pressures over the coming year.