The following is an update of various indicators that are supposed to predict and/or depict economic activity. These indicators have been discussed in previous blog posts:
The September 2020 Chicago Fed National Activity Index (CFNAI) updated as of September 21, 2020:
The CFNAI, with a current reading of .79:
source: Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis, September 21, 2020;
https://fred.stlouisfed.org/series/CFNAI
The CFNAI-MA3, with a current reading of 3.05:
source: Federal Reserve Bank of Chicago, Chicago Fed National Activity Index: Three Month Moving Average [CFNAIMA3], retrieved from FRED, Federal Reserve Bank of St. Louis, September 21, 2020;
https://fred.stlouisfed.org/series/CFNAIMA3
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The ECRI WLI (Weekly Leading Index):
As of September 18, 2020 (incorporating data through September 11, 2020) the WLI was at 139.4 and the WLI, Gr. was at 2.3%.
A chart of the WLI,Gr., from the Advisor Perspectives’ ECRI update post of September 18, 2020:
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The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:
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The Conference Board Leading (LEI), Coincident (CEI) Economic Indexes, and Lagging Economic Indicator (LAG):
As per the September 18, 2020 Conference Board press release, titled “The Conference Board Leading Economic Index (LEI) for the U.S. Increased in August” the LEI was at 106.5, the CEI was at 100.8, and the LAG was 107.6 in August.
An excerpt from the release:
“While the US LEI increased again in August, the slowing pace of improvement suggests that this summer’s economic rebound may be losing steam heading into the final stretch of 2020,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board. “Despite the improvement, the LEI remains in recession territory, still 4.7 percent below its February level. Weakening in new orders for capital goods, residential construction, consumers’ outlook, and financial conditions point to increasing downside risks to the economic recovery. Looking ahead to 2021, the LEI suggests that the US economy will start the new year under substantially weakened economic conditions.”
Here is a chart of the LEI from the Advisor Perspectives’ Conference Board Leading Economic Index update of September 18, 2020:
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I post various indicators and indices because I believe they should be carefully monitored. However, as those familiar with this site are aware, I do not necessarily agree with what they depict or imply.
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The Special Note summarizes my overall thoughts about our economic situation
SPX at 3251.78 as this post is written
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