Daily Archives: May 20, 2015 at 09:09 am EDT

Chicago Fed Nat’l Activity Index: April 2015 Preview

The three-month average of the Chicago Fed National Activity Index (CFNAI) is expected to slip a bit deeper into negative territory in the April update that’s scheduled for tomorrow (May 21), based on The Capital Spectator’s median point forecast for several econometric estimates. The projection for -0.31 is slightly below the -0.27 reading for March, which reflected a below-average pace of economic growth for the US relative to the historical trend. Only negative values below -0.70 indicate an “increasing likelihood” that a recession has started, according to guidelines from the Chicago Fed. Using today’s estimate for April as a guide, CFNAI’s three-month average is expected to remain at a rate of growth that’s below the historical trend but still above the tipping point that marks the start of a new recession.
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US Business Cycle Risk Report | 20 May 2015

US economic growth has slowed in recent months, but the deceleration to date remains well short of a tipping point for the business cycle, based on a broad set of published reports through April. There’s heightened concern that the economy will remain unusually vulnerable if the weakness persists in the second-quarter. As a result, the yet-to-be published numbers for May could be decisive. Meantime, the current numbers strongly suggest that April wasn’t the start of a new recession for the US. Growth may turn out to be slower than recently anticipated, but it’s not yet obvious that a sluggish pace of expansion will soon lead to a new phase of economic contraction.
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Initial Guidance | 20 May 2015

● US Housing Starts in U.S. Surge to 7-Year High as Weather Warms | Bloomberg
● US Government Bonds Hit by Surge in Housing Starts | WSJ
● US Retail Sales Fall in First Two Weeks of May From April: Redbook | Nasdaq
● Dueling Views on the First-Quarter GDP Slump In The US | NY Times
● Japan’s economy grows faster than expected | BBC
● ECB To Discuss Lending Rules For Greece On Wednesday | RTT
● India’s economic growth to surpass China next year: UN report | IndiaToday