CFNAI Shows Economic Growth Above Trend in January

The Chicago Fed National Activity Index was +0.27 in January, down from +0.37 in December. Three of the four broad categories of indicators that make up the index made positive contributions, while the remaining category made a small negative contribution (see sidebar). The three-month moving average, CFNAI-MA3, was +0.52 in January. A CFNAI-MA3 reading above zero is associated with above-trend economic growth; accordingly, the CFNAI-MA3 value of +0.52 in January suggests that growth in national economic activity was above its historical trend. However,the high level of the CFNAI-MA3 partly reflects the temporary boost in activity during November as the economy recovered from hurricane-related disruptions. With regard to inflation, a CFNAI-MA3 value above zero indicates the potential for inflationary pressures over the coming year.