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 2023 Chicago Fed National Activity Index (CFNAI) updated as of August 24, 2023. The CFNAI has a current reading of .12. The CFNAI-MA3 has a current reading of -.13. A chart depicting the CFNAI and CFNAI-MA3 from the August 24, 2023 Advisor Perspectives’ CFNAI update:
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The Aruoba-Diebold-Scotti Business Conditions (ADS) Index
The ADS Index as of August 17, 2023, reflecting data from March 1, 1960 through August 12, 2023, with last value .264792:
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The Conference Board Leading Economic Index (LEI), Coincident Economic Index (CEI), and Lagging Economic Index (LAG):
As per the August 17, 2023 Conference Board press release the LEI was 105.8 in July, the CEI was 110.5 in July, and the LAG was 118.3 in July.
An excerpt from the release:
“The US LEI—which tracks where the economy is heading—fell for the sixteenth consecutive month in July, signaling the outlook remains highly uncertain” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “On the other hand, the coincident index (CEI)—which tracks where economic activity stands right now—has continued to grow slowly but inconsistently, with three of the past six months not changing and the rest increasing. As such, the CEI is signaling that we are currently still in a favorable growth environment. However, in July, weak new orders, high interest rates, a dip in consumer perceptions of the outlook for business conditions, and decreasing hours worked in manufacturing fueled the leading indicator’s 0.4 percent decline. The leading index continues to suggest that economic activity is likely to decelerate and descend into mild contraction in the months ahead. The Conference Board now forecasts a short and shallow recession in the Q4 2023 to Q1 2024 timespan.”
Here is a chart of the LEI from the Advisor Perspectives’ Conference Board Leading Economic Index (LEI) update of August 17, 2023:
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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 4409.42 as this post is written