Chicago Fed: Economic Growth Decreased in January

The headline for this morning's release of the Chicago Fed's National Activity Index (CFNAI) reads "Index suggests economic growth decreased in January".

The Chicago Fed National Activity Index (CFNAI) dropped to -0.30 in January from +0.02 in December. Three of the four broad categories of indicators used to construct the index decreased from December and three categories made negative contributions in January.

Background on the Chicago Fed National Activity Index (CFNAI)

In an article, Lance Roberts of Real Investment Advice called the CFNAI one of the "most important and overlooked economic indicators". The Chicago Fed's National Activity Index is a monthly indicator designed to gauge overall economic activity and related inflationary pressure. It is a composite of 85 monthly indicators as explained in this background PDF file on the Chicago Fed's website. The CFNAI is a forward-looking indicator that suggests how the economy will likely look in the near term. The index is constructed so a zero value for the index indicates that the national economy is expanding at its historical trend (average) rate of growth. Negative values indicate below-average growth, and positive values indicate above-average growth.