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Chicago Fed Index Dip Reflects Slowdown From Strong March Data


The Chicago Fed's National Activity Index slipped to +0.21 in April from +1.71 in March, well below expectations of +1.20. The overall reading suggests that US growth moderated in April, with 47 of 85 individual indicators within the index making positive contributions, with 38 subtracting.

  • Note that this is basically just a holistic snapshot of data we've already seen, from the employment report to industrial production. March's reading was the highest since July 2020, so some retracement was expected, but the main subcomponents certainly don't make for particularly positive reading for economic momentum going into the spring (see chart).
  • Production indicators' contribution to the headline index fell to +0.18 from +0.92 (reflecting the slowdown in industrial and manufacturing production), and personal consumption /housing subtracted 0.06 points (vs +0.50 in March, reflecting disappointing retail sales among other factors). Likewise with employment/unemployment/hours, whose contribution slowed to +0.05 from +0.38 (on a weak nonfarm payrolls report vs March).
  • The sales/orders/inventories' category was the only category that contributed more to the headline index vs March, rising to 0.07 from -0.09.

Source: Chicago Fed CFNAI

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