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 July 2022 Chicago Fed National Activity Index (CFNAI) updated as of July 25, 2022:
The CFNAI, with a current reading of -.19:
source: Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed July 25, 2022:
https://fred.stlouisfed.org/series/CFNAI
The CFNAI-MA3, with a current reading of -.04:
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; accessed July 25, 2022:
https://fred.stlouisfed.org/series/CFNAIMA3
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The ECRI WLI (Weekly Leading Index):
As of July 22, 2022 (incorporating data through July 15, 2022) the WLI was at 144.5 and the WLI, Gr. was at -10.8%.
A chart of the WLI,Gr., from the Advisor Perspectives’ ECRI update post of July 22, 2022:
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The Aruoba-Diebold-Scotti Business Conditions (ADS) Index
The ADS Index as of July 21, 2022, reflecting data from March 1, 1960 through July 16, 2022, with last value -.151012:
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The Conference Board Leading Economic Index (LEI), Coincident Economic Index (CEI), and Lagging Economic Index (LAG):
As per the July 21, 2022 Conference Board press release titled “The Conference Board LEI for the US Fell Further in June” the LEI was 117.1 in June, the CEI was 108.6 in June, and the LAG was 113.9 in June.
An excerpt from the release:
“The US LEI declined for a fourth consecutive month suggesting economic growth is likely to slow further in the near-term as recession risks grow,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board. “Consumer pessimism about future business conditions, moderating labor market conditions, falling stock prices, and weaker manufacturing new orders drove the LEI’s decline in June. The coincident economic index which rose in June suggests the economy grew through the second quarter. However, the forward-looking LEI points to a US economic downturn ahead.”
“Amid high inflation and rapidly tightening monetary policy, The Conference Board expects economic growth will continue to cool throughout 2022. A US recession around the end of this year and early next is now likely. Accordingly, we’ve downgraded our forecast of 2022 annual Real GDP growth to 1.7 percent year-over-year (from 2.3 percent), while 2023 growth was downgraded to 0.5 percent YOY (from 1.8 percent).”
Here is a chart of the LEI from the Advisor Perspectives’ Conference Board Leading Economic Index (LEI) update of July 21, 2022:
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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 3965.22 as this post is written
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