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 August 2022 Chicago Fed National Activity Index (CFNAI) updated as of August 22, 2022:
The CFNAI, with a current reading of .27:
source: Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed August 22, 2022:
The CFNAI-MA3, with a current reading of -.09:
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 August 22, 2022:
The ECRI WLI (Weekly Leading Index):
As of August 19, 2022 (incorporating data through August 12, 2022) the WLI was at 144.6 and the WLI, Gr. was at -12.5%.
A chart of the WLI,Gr., from the Advisor Perspectives’ ECRI update post of August 19, 2022:
The Aruoba-Diebold-Scotti Business Conditions (ADS) Index
The ADS Index as of August 18, 2022, reflecting data from March 1, 1960 through August 13, 2022, with last value .354862:
The Conference Board Leading Economic Index (LEI), Coincident Economic Index (CEI), and Lagging Economic Index (LAG):
As per the August 18, 2022 Conference Board press release the LEI was 116.6 in July, the CEI was 108.6 in July, and the LAG was 114.4 in July.
An excerpt from the release:
“The US LEI declined for a fifth consecutive month in July, suggesting recession risks are rising in the near term,” said Ataman Ozyildirim, Senior Director, Economics, The Conference Board. “Consumer pessimism and equity market volatility as well as slowing labor markets, housing construction, and manufacturing new orders suggest that economic weakness will intensify and spread more broadly throughout the US economy. The Conference Board projects the US economy will not expand in the third quarter and could tip into a short but mild recession by the end of the year or early 2023.”
Here is a chart of the LEI from the Advisor Perspectives’ Conference Board Leading Economic Index (LEI) update of August 18, 2022:
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.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 4161.20 as this post is written