CFNAI Indicates Economic Growth Above Trend in August

The Chicago Fed National Activity Index was +0.10 in August, down from +0.28 in July. Three of the four broad categories of indicators that make up the index—employment, consumption and housing, and sales, orders, and inventories—made positive contributions (see sidebar). The three-month moving average, CFNAI-MA3, was +0.26 in August. A CFNAI-MA3 reading above zero is associated with above-trend economic growth; accordingly, the CFNAI-MA3 value of +0.26 in August suggests that growth in national economic activity was above its historical trend. With regard to inflation, a CFNAI-MA3 value above zero indicates the potential for inflationary pressures over the coming year.