I mentioned in yesterday’s video that we see general conditions waning. One of our proprietary macro index’s waning components has been The Chicago Fed National Activity Index.
April’s very weak industrial production report pulled
down the national activity index to a much weaker-
than-expected minus 0.45, and with that the 3-month
average to minus 0.22. These are the weakest
showings for this report in three years.
Production-related indicators declined to minus
0.44 in April from minus 0.04 in March
reflecting headline 0.5 percent declines for
both industrial production and specifically
manufacturing production. Also pulling the
index lower is a minus 0.05 showing for the
personal consumption & housing component
vs a neutral reading for March. The other
components – employment and sales/orders/
inventories – were little changed and
marginal positives for the composite.
This report focuses attention on the two
salients of April’s economic indicators:
manufacturing weakness tied in part to
extended weakness in global demand and
trouble for domestic consumer spending,
at least for April.